KHAS 109 Computational Thinking
Achieving Competitive Advantage
Ass’t Prof. Dr. Mehmet Çiçek, PhD CPA
Week 13
Project Evaluation and
Control
Learning Objectives (1 of 2)
13.1 Understand the nature of the control cycle and the four
key steps in a general project control model.
13.2 Recognize the strengths and weaknesses of common
project evaluation and control methods.
13.3 Understand how Earned Value Management can
assist project tracking and evaluation.
13.4 Use Earned Value Management for project portfolio
analysis.
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Learning Objectives (2 of 2)
13.5 Understand critical issues in the effective use of
Earned Value Management.
13.6 Understand behavioral concepts and other human
issues in evaluation and control.
13.7 From Appendix 13.1: Understand the advantages of
Earned Schedule methods for determining project schedule
variance, schedule performance index, and estimates to
completion.
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Core Concepts
covered in this chapter includes:
1. Control Schedule
2. Control Costs
3. Earned Value System
4. Forecasting
5. Performance Reviews
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Control Cycles—General Model
1. Setting a goal.
2. Measuring progress.
3. Comparing actual with planned performance.
4. Taking action.
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Figure 13.2 The Project Control Cycle
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Figure 13.3 Project S-Curves
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Figure 13.4 Project Sierra’s S-Curve
Showing Negative Variance
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Milestone Analysis
Milestones are events or stages of the project that represent a
significant accomplishment.
Milestones:
1. Signal completion of important steps
2. Motivate team and suppliers
3. Offer reevaluation points
4. Help coordinate schedules
5. Identify key review gates
6. Signal other team members when their participation begins
7. Delineate work packages
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Figure 13.5 Gantt Chart with Milestones
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Figure 13.6 Assessing Project Blue’s Status
Using Tracking Gantt Chart
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Figure 13.7 Tracking Gantt with Project
Activity Deviation
Project status is updated by linking task completion to the
schedule baseline.
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Earned Value Management
Earned Value Management (EVM) recognizes that it is
necessary to jointly consider the impact of time, cost, and
project performance on any analysis of current project
status.
Earned Value (EV) directly links all three primary project
success metrics (cost, schedule, and performance).
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Earned Value Terms
• Planned value (PV)
• Earned value (EV)
• Actual cost of work performed (AC)
• Schedule variance (SV) and schedule performance index
(SPI)
• Cost variance (CV) and cost performance index (CPI)
• Budgeted cost at completion (BAC)
• Estimate at completion (EAC)
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Steps in Earned Value Management
1. Clearly define each activity including its resource
needs and budget.
2. Create usage schedules for activities and resources.
3. Develop a time-phased budget (PV).
4. Total the actual costs of doing each task (AC).
5. Calculate both the budget variance (CV) and schedule
variance (SV).
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Figure 13.11 Project Baseline, Using
Earned Value
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Figure 13.12 Earned Value Milestones
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Earned Value Example
Schedule Variances
Planned Value (PV) = 103
Earned Value (EV) = 44
44 EV
Schedule Performance Index 43
103 PV
1
Estimated Time to Completion 7 163 months
.43
Cost Variances
Cumulative Actual Cost of Work Performed (AC) = 78
44 EV
Cost Performance Index 56
78 AC
1
Estimated Cost to Completion $210,714 $118,000
.56
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Figure 13.16 Earned Value Report for
Project Atlas on May 19
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Flow of Earned Value System
Northrop Grumman’s flow of earned value management:
• Proposal stage
• Contract award
• Baseline stage
• Maintenance phase
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Using Earned Value to Manage a Portfolio
of Projects
Table 13.9 Project Portfolio Earned Value (in thousands $)
Time Cost Est. at
Project PV EV Var ($) Var AC Var ($) Var+ Plan Completion
Alpha 91 73 -18 18 83 -10 10 254 289
Beta 130 135 5 0 125 10 0 302 280
Gamma 65 60 -5 5 75 -15 15 127 159
Delta 25 23 -2 2 27 -4 4 48 56
Epsilon 84 82 -2 2 81 1 0 180 178
Blank 395 373 Blank Blank 391 Blank Blank Blank 962
Total Schedule Variance 27 Total Cost Variance 29
27 29
Relative Schedule Variance 6.84% Relative Cost Variance 7.34%
395 395
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Completion Values in EVM
Accurate and up-to-date information is critical in the use
of EVM.
0
• Rule
100
50
• Rule
50
• Percentage Complete Rule
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Human Factors in Project Evaluation and
Control
• Project coordination and relations among stakeholders
• Adequacy of project structure and control
• Project uniqueness, importance, and public exposure
• Success criteria salience and consensus
• Lack of budgetary pressure
• Avoidance of initial overoptimism and conceptual
difficulties
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Critical Success Factors in the Project
Implementation Profile
1. Project mission
2. Top management support
3. Project plans and schedules
4. Client consultation
5. Personnel
6. Technical tasks
7. Client acceptance
8. Monitoring and feedback
9. Communication channels
10. Troubleshooting
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved
Thanks
Copyright © 2020 Pearson Education, Ltd. All Rights Reserved