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Earned Value Advice

6 replies [Last post]
Debosky Wale
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Good evening

I am currently on an EPC project as a client-planner. The programme was baseline with the contract sum at the commencement of the project by the Turnkey  Contractor. The project is now into a year out of its 2yrs lifespan.

The process I have in place is to request the contractor to send xer at the end of the month, so I can conduct necessary due diligence and produce an earned value report.

My director has just questioned why the contract sum on the EV report has not changed considering, the budget has increased by various VO’S.

My understanding is that VOS must be kept separate except when there’s a need for rebaselining, please correct me if am wrong?

The director then question the relevance of the EV especially SPI if the cost increase due to VO’s

My question is into two parts.

  1. How do you manage VO’S + SPI in a situation as described above
  2. Of what relevance is SPI if the cost on the project has increased, but we still use the original budget sum to calculate

Appreciate experience from house gurus, please.

Many thanks

Replies

Rafael Davila
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Your problem might be in the use of negative lag.  Please read the following references.

THE POOR PLANNING PRACTICE OF USING NEGATIVE LAG

MS PROJECT FOR CONSTRUCTION SCHEDULERS

Your post should be at Microsoft Project forum.  If not already under discussion then post a new discussion.  In this way you should get better response from Microsoft Project users without interrupting unrelated discussions. 

Good luck,

Rafael

Amit Sinha
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6871
screenshot.png
Hi Friends,

I have made a plan of over 10000 activities. this is for a Large Cement Plant projects. After completing the linking and starting the analysis part. The very first thing i was checking is total float. 

Let me explaing the WBS strs. first. Any Structure start with the a) Procurement b) Detail Engineering c) Manufacturing & Delivery d) Construction d1) Civil d2) Mechanical d3)Electrical d4) Instrumentation d5) Trial Run & d6) Commissioning

After i am done with all linking, the problem i am facing is minimum float at trial run level and very high float at individual level (Civil/Mechanicl/Electrical/Instrumentation). As far as understand the total available float is the float which specifies the available free time for the structure to be ready. and it should be same for all the sub sections of the structures. (See the attached pics).

Can anybody help me, where i am going wrong, why this total float at all the level is not coming same?

Zoltan Palffy
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wrong 

that would mean that you would re-basline every month

Raymund de Laza
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My understanding is that VOS must be kept separate except when there’s a need for rebaselining, please correct me if am wrong?

You are Correct.

Create a Separate WBS for the Initial Contract and the VO's. This will give a separate SPI for each.

Zoltan Palffy
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no keep the baseline as is I dont know what a VO is but if it is the same as a CO and represents additional work you need to add these VO's on a monthly basis everytime that you update the schedule. Add the new task and the associated manhours and cost for each VO then progress it as you would do any other activity. The base contract amount and all of the VO's added together should total your new contract amount. 

Rafael Davila
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How do you manage VO’S + SPI in a situation as described above?

Of what relevance is SPI if the cost on the project has increased, but we still use the original budget sum to calculate?

You said “The director then question the relevance of the EV especially SPI if the cost increase due to VO’s”. 

  • Earned Value Management as a tool for Project Control - However, 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.
  • EV is flawed with regard to scheduling, in any case good only for basic accounting metrics and cost management. 
  • The DOD is against its requirement for fixed price contracts.