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What are the 13 key Earned Value metrics on the PMP Exam?
- BAC - Budgeted At Completion
- PV - Planned Value
- EV - Earned Value
- AC - Actual Cost
- CV - Cost Variance
- SV - Schedule Variance
- CPI - Cost Performance Index
- CPIC - Cumulative Cost Performance Index
- SPI - Schedule Performance Index
- EAC - Estimate At Completion
- ETC - Estimate To Completion
- VAC - Variance At Completion
- TCPI - To-Complete Performance Index
- Budgeted At Completion
- How much we originally expected this project to cost
- Planned Value
- aka Budgeted Cost of Work Scheduled (BCWS)
- PV = % of planned time burned * BAC
- Earned Value
- aka Budgeted Cost of Work Performed (BCWP)
- EV = % of actual functionality delivered * BAC
- Actual Cost
- aka Actual Cost of Work Performed
- AC = Actual expenditure to date
- Cost Variance
- How much actual cost differs from planned costs
- CV = EV - AC
Positive CV - good or bad?
Good. We're doing better than planned.
Negative CV - good or bad?
Bad. We're doing worse than planned.
Is CV derived using PV or AC and why?
CV = EV - AC. Use AC because it represents actuals whereas PV represents plan. We want ACTUAL cost variance. Using PV would yield Schedule Variance.
- Schedule Variance
- How much our schedule differs from the plan
- SV = EV-PV
Positive SV - good or bad?
Good. We're ahead of schedule.
Negative SV - good or bad?
Bad. We're behind schedule.
- Cost Performance Index
- Indicates how much VALUE we're actually getting for every dollar we expected
- CPI = EV / AC
CPI = 1 - good or bad?
Good - we're getting the precise value for each dollar we planned.
CPI > 1 - good or bad?
Good - we're getting greater value for each dollar than we planned.
CPI < 1 - good or bad?
Bad - we're getting less value for each dollar than we planned.
- Schedule performance Index
- Indicates how FAST the project is progressing vs the plan
- SPI = EV / PV
SPI = 1 - good or bad?
Good - we're performing at precisly the speed we planned.
SPI > 1 - good or bad?
Good - we're performing FASTER than we planned
SPI < 1 - good or bad?
Bad - we're performing SLOWER than we planned
- Estimate at Completion
- What do we expect the project to cost base on where we are on cost & schedule
- EAC = BAC / CPI
- Estimate To Completion (not estimate to COMPLETE)
- How much more we expect to spend from this point forward
- ETC = EAC - AC
- Variance At Completion
- Difference between what we originally planned and what we NOW expect to spend on the project
- VAC = BAC - EAC
Positive VAC - good or bad?
Good - we now expect to spend less than we originally planned
Negative VAC - good or bad?
Bad - we now expect to spend MORE than we originally planned
- Cumulative Cost Performance Index
- CPI = EV / AC. If EV and AC are measured at regular intervals, CPIC is cumulative EV / cumulative AC.
What is the value of CPI as a metric vs CPIC?
CPI gives a good snapshot of a particular period (assuming EV and AC represent only a period measurement). CPIC represents the longterm health of the project and is a good indicator of performance at completion.
- To-Complete Performance Index
- Performance which must be achieved to meet financial goals
- TCPI = (BAC - EV) / Remaining Funds
TCPI = 1 - good or bad?
Good - we have to perform exactly as we planned to meet our budget
TCPI > 1 - good or bad?
BAD - we have to perform MORE efficiently than we planned to meet our budget
TCPI < 1 - good or bad?
GOOD - we can perform LESS efficiently than we planned and still meet our budget
What are the 5 classifications of costs?
What would you like to do?
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