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Planned Start / Planned Finish dates in relation to cost loaded spread of monies

4 replies [Last post]
Kieran Eivers
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Good Afternoon,

I have re-visited some cost loading bars in the programme and split them out in order for the commerical team to accurately represent the cost spread.

The actual start date for the cost bars is in the past, i.e. before the data date and have been actualised. Whilst reviewing the spread of the budgeted cost, it was clear the monies were not being spread across the correct months. To try and rectify this, I deleted the resource and assigned a completely new resourse budget and put it on a linear curve. This did not work.

I was then informed that it is most likely because the planned start / planned finish dates did not match the actual dates.

I installed the planned start / planned finish columns and adjusted these dates to match the actuals. This now worked.

My questions are as follows:

1) Why do the planned start / planned finish dates drive the spread of the monies and not the actual start / finish dates?

2) The start / finish dates are going to most likely move every period, therefore, do I need to continually update the planned start / planned finish dates to match the new actuals to give an accurate spread of money?

3) Where else would I need to consider planned start / planned finish dates in my planning duties?

Thanks

Kieran

Replies

Zoltan Palffy
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The start / finish dates only drive the spread of the monies for forecasted dates

There is a curve for actual start / finish dates also

2) The start / finish dates are going to most likely move every period, therefore, do I need to continually update the planned start / planned finish dates to match the new actuals to give an accurate spread of money?

no just show the forcasted early curve and the actual curve to get the spread

Rafael Davila
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The Planned dates have a highly complex, two-way interaction with other fields in the P6 schedule; Planneddates are neither static like baseline dates nor dynamic like Early and Late dates.

The budget spread in CPM schedules do have an early spread as well as a late spread.  Earned Value Management [EVM] does not distinguish available float, it does not distinguish between critical and non-critical activities.  Tracking variance at the activity level without taking into account float makes no sense. We must pay attention to critical activities and resources where EVM is of little or no help.

  • An S-curve is a result of schedule logic. On the level of activities, projects tend to have many paths, some of them critical, other not. A tiny (if compared to total project duration) schedule variance of an activity can become a cause for substantial rearrangements in the project network, it can change critical path or order of activities, enforce a total reorganization of works. This cannot be captured by either Earned Value or Earned Schedule calculations - potential problems might be masked by compensating positive and negative schedule deviations.
  • Earned Value Analysis does not distinguish between the works done on critical activities and activities with sufficient floats. A project could be late but EVA will not notice this problem if Earned Value exceeds Planned Value.
  • Earned Value Analysis motivates project managers to do expensive tasks first delaying cheaper activities that could have higher priorities.
  • The Department of Defense [DOD], the father of the creature is against the use of EVM in fixed price contracts. 
  • Department of Defense Earned Value Management Implementation Guide
  • 2.2.3.7 Exclusions for Firm Fixed Price (FFP) Contract Type. The application of EVM on FFP contracts and agreements is discouraged, regardless of dollar value.

The schedule contract milestones give us all we need to know if ahead/behind schedule; Cost Accounts tell us if we are under/over budget.  It is simple; no esoteric procedures such as EVM are required, no EVM jargon only a few at the field understand. If you must live with EVM learn its limitations.

  • Earned Value Management as a tool for Project Control
  • However, if to be implemented, the method should be used according to its purpose: it is not a tool for forecasting; instead, it facilitates progress monitoring, determination of project status (on time? to budget?), identification of potentially negative occurrences and a rough estimate of their combined effect on the project’s outcome. If the project is to be managed consciously, these occurrences should be then investigated into by means of more accurate methods.

To say that the only correct distribution is the early dates distribution is in abominable error.

Showing a summary of cost distributions is not enough to disclose how the costs are spread.  A tabular report showing Early and Late spreads for every cost component assigned to every activity will do it.

Cost-Distributions-2019-05-05

Raymund de Laza
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Please check your settings for earned value calculations, either using planned or current dates.
Rafael Davila
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http://www.planningplanet.com/blog/understanding-planned-dates-oracle-primavera-p6

Also take a look at the references at end of article.