Earned ScheduleEarned Schedule…an extension to EVM theory…an extension to EVM theory

Walt LipkeSoftware Division

Tinker AFBwalter.lipke@tinker.af.mil

(405) 736-3341

E.V.A. - 10 Symposium

May 17-20, 2005 London, England

Kym HendersonEducation Director

PMI Sydney, Australia Chapterkym.henderson@froggy.com.au

61 414 428 537

2

PurposePurpose

To discuss and encourage the application of a new method of schedule analysis derived from Earned Value Management, termed “Earned ScheduleEarned Schedule.”

3

OverviewOverview

• The Problem with EVM• Earned Schedule Concept• Applications• Status & Future• Summary

The ProblemThe Problem

EVA-10 SymposiumMay 18-20, 2005London, England

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Earned Value BasicsEarned Value Basics

Time

$

BCWSBCWPSPI =

ACWPBCWPCPI=

BACBCWS

ACWP

BCWP

SVCV

6

• Traditional schedule EVM metrics are good at beginning of project– Show schedule performance trends

• But the metrics don’t reflect real schedule performance at end– Eventually, all “budget” will be earned as the work is completed,

no matter how late you finish• SPI improves and ends up at 1.00 at end of project• SV improves and ends up at $0 variance at end of project

– Traditional schedule metrics lose their predictive ability over the last third of project

• Impacts schedule predictions, EAC predictions

•• Project managers don’t understand schedule Project managers don’t understand schedule performance in terms of budgetperformance in terms of budget– Like most of us!

So, what’s the problem?So, what’s the problem?

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Earned ValueEarned ValueCost and Schedule VariancesCost and Schedule Variances

+$

-$

001 02

CV = BCWP - ACWP SV = BCWP - BCWS

Note: Project completion was scheduled for Jan 02, but completed Apr 02.

J F M A M J J A S O N D J F M A

CVSV

CV = BCWP - ACWP SV = BCWP - BCWS

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Earned ValueEarned ValueCost and Schedule Performance IndicesCost and Schedule Performance Indices

0.0

0.5

1.0

1.5

2.0

J F M A M J J A S O N D J F M A

CPISPI

01 02

Note: Project completion was scheduled for Jan 02, but completed Apr 02.

BCWSBCWPSPI =

ACWPBCWPCPI =

IND

EX V

ALU

E

Earned ScheduleEarned ScheduleConceptConcept

EVA-10 SymposiumMay 18-20, 2005London, England

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Earned Schedule ConceptEarned Schedule Concept

BCWSBCWPSPI($) =

ATESSPI(t) =

$

Time

BCWS

BCWP

Projection of BCWPonto BCWS

7ATBCWS(May) - BCWS(June)

BCWS(May) - BCWP($) 5 ES

June of Portion May of AllES

=

+=

+=

J J JF M MA A S O N

BCWSBCWPSV($) −=

ATESSV(t) −=

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Schedule Variance ComparisonSchedule Variance Comparison

-400

-300

-200

-100

0

J F M A M J J A S O N D J F M-3

-2

-1

0

0

20

40

60

80

100

J F M A M J J A S O N D J F M0

0.2

0.4

0.6

0.8

1

SV($) SV(t)

Early Finish Project

Late Finish Project

$ Mo

$ Mo

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Schedule Performance Index Schedule Performance Index ComparisonComparison

0.98

1.00

1.02

1.04

1.06

1.08

1.10

1.12

J F M A M J J A S O N D J F M

0.70

0.80

0.90

1.00

1.10

1.20

1.30

J F M A M J J A S O N D J F M

SPI($) SPI(t)

Early Finish Project

Late Finish Project

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Earned Schedule IndicatorsEarned Schedule Indicators

•• Key PointsKey Points::–– ES Indicators constructed to behave in an ES Indicators constructed to behave in an

analogous manner to the EVM Cost Indicators, analogous manner to the EVM Cost Indicators, CV and CPICV and CPI

–– SV(t) and SPI(t) are SV(t) and SPI(t) are notnot constrained by BCWS constrained by BCWS calculation referencecalculation reference

–– SV(t) and SPI(t) provide SV(t) and SPI(t) provide durationduration based based measures of schedule performancemeasures of schedule performance

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SV($) versus SV(t)SV($) versus SV(t)BCWS

Earned Schedule (ES)

BCWP

Actual TimeActual Time

SV(t)

$

SV

• Earned schedule metrics relate work performed to actual time, not work scheduled

• Retain utility over time• Only return to 0 or 1.00 where “on time” completion achieved

• Earned schedule metrics relate work performed to actual time, not work scheduled

• Retain utility over time• Only return to 0 or 1.00 where “on time” completion achieved

ApplicationsApplications

EVA-10 SymposiumMay 18-20, 2005London, England

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ES Applied to Real Project Data:Late Finish Project: SV($) and SV(t)

Commercial IT Infrastructure Expansion Project Phase 1 Cost and Schedule Variances

at Project Projection: Week Starting 15th July xx

-160

-140

-120

-100

-80

-60

-40

-20

0

20

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34

Elapsed Weeks

Dol

lars

(,00

0)

-16

-14

-12

-10

-8

-6

-4

-2

0

2

Wee

ks

CV cum SV cum Target SV & CV SV (t) cum

Stop wk 19

Re-start wk 26Sched wk 20

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Early Finish Project: Early Finish Project: SV($) and SV(t)SV($) and SV(t)

Commerical IT Infrastructure Expansion Project: Phases 2 & 3 CombinedCost and Schedule Variances

as at Project Completion: Week Starting 9th October xx

-25.0

-15.0

-5.0

5.0

15.0

25.0

35.0

45.0

55.0

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Elapsed Weeks

Dol

lars

($,0

00)

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

5.0

Wee

ks

Target SV & CV CV cum SV ($) cum SV (t) cum

Stop wk 16

Re-start wk 19

Sched wk 25

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IEAC(t) Predictions using IEAC(t) Predictions using ESES Techniques: Techniques: Weekly Plots of IEAC(t) Weekly Plots of IEAC(t)

Late Finish Project ExampleLate Finish Project Example

Commercial IT Infrastructure Expansion Project Phase 1Earned Schedule, Independent Estimate At Completion (time) - IEAC(t)

as at Project Completion: Week Starting 15th July xx

0

5

10

15

20

25

30

35

40

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34

Actual Time (Weeks)

Dur

atio

n (W

eeks

)

Planned Schedule Earned Schedule cum IEAC(t) PD/SPI(t)

Stop wk 19 Re-start wk 26

Plan Dur wk 20

19

IECD Predictions using IECD Predictions using ESES Techniques: Techniques: Weekly Plots ofWeekly Plots of

Independent Estimate of Completion DateIndependent Estimate of Completion Date

Commercial IT Infrastructure Expansion Project Phase 1Earned Schedule, Independent Estimates of Completion Date (IECD)

as at Project Completion: Week Starting 15th July xx

0

5

10

15

20

25

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34

Actual Time (Weeks)

Dur

atio

n (W

eeks

)

27 Jan 90

10 Feb 90

24 Feb 90

10 Mar 90

24 Mar 90

07 Apr 90

21 Apr 90

05 May 90

19 May 90

02 Jun 90

16 Jun 90

30 Jun 90

14 Jul 90

28 Jul 90

Planned Schedule Earned Schedule cum Planned Completion Date Independent Estimate of Completion Date

Stop wk 19 Plan Dur wk 20Compl Apr 7

Re-start wk 26

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ES vs EVM ComparisonES vs EVM Comparison

Earned Schedule Earned Value

SV(t) and SPI(t) valid for entire project, including early and late finish

SV($) and SPI($) validity limited to early finish projects

Duration based predictive capability analogous to EVM’s cost based indicators

Limited prediction capabilityNo predictive capability after planned completion date exceeded

Facilitates Cost – Schedule Management (using EVM and ES)

EVM Management focused to Cost

Status & FutureStatus & Future

EVA-10 SymposiumMay 18-20, 2005London, England

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TimeTime--Based Schedule Measures Based Schedule Measures ––An Emerging EVM PracticeAn Emerging EVM Practice

• Inclusion of Emerging Practice Insert into PMI - EVM Practice Standard– Dr. John Singley, VP of CPM

• Included in Box 3-1 of EVM Practice Standard– Describes basic principles of

“Earned Schedule”– Provides foundation for further

development of and research intended to result in Earned Schedule acceptance as a valid extension to EVM

• EVM Practice Standard released at 2004 IPMC Conference

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Early AdoptersEarly Adopters• Incorporation of ES into EVM Instruction

– Several instruction sources now offer ES “as part of EVM”

• Requests for information and ES calculator– Calculator provided freely to > 50 requestors

• Tool vendor interest• Growing evidence of use on real projectsreal projects

– Evidence of use in a number of countries• USA, Australia, Sweden, Belgium …

– Applications across weapons programs, construction, software development, …

– Range of project size from very small and short to extremely large and long duration

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Foreseen Uses of Foreseen Uses of Earned ScheduleEarned Schedule

• Enables independent evaluation of schedule estimates: ETC(t), EAC(t)– Client, Contractor, Program and Project Manager ….

• Facilitates insight into network schedule performance– Duration based Schedule indicators– Identification of impediments/constraints and potential

future rework– Evaluation of adherence to plan

• Improvement to Schedule and Cost prediction– Client, Contractor, Program and Project Manager ….

• Application of direct statistical analysis of schedule performance

SummarySummary

EVA-10 SymposiumMay 18-20, 2005London, England

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SummarySummary• Derived from EVM data … only• Provides time-based schedule indicators• Indicators do not fail for late finish projects• Application is scalable up/down, just as is EVM• Schedule prediction is better than any other EVM

method presently used– SPI(t) behaves similarly to CPI– IEAC(t) = PD / SPI(t) behaves similarly to

IEAC = BAC / CPI

•• Facilitates bridging EVM to the scheduleFacilitates bridging EVM to the schedule

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ReferencesReferences1. “Schedule is Different,” The Measurable News,

March & Summer 2003 [Walt Lipke]2. “Earned Schedule: A Breakthrough Extension to Earned Value Theory?

A Retrospective Analysis of Real Project Data,”The Measurable News, Summer 2003 [Kym Henderson]

3. “Further Developments in Earned Schedule,”The Measurable News, Spring 2004 [Kym Henderson]

4. “Connecting Earned Value to the Schedule,” The Measurable News, Winter 2004 [Walt Lipke]

5. “‘Forecasting Project Schedule Completion’ by Using Earned Value Metrics”Presentation by Ing. Stephan Vandevoorde, Senior Project Manager, Fabricom Airport Systems, Belgium

6. “Earned Schedule in Action”, Publication pending, [Kym Henderson]

http://sydney.pmichapters-australia.org.au/Click “Education,” then “Presentations and Papers” for .pdf copies, except (6)