DİPLOMATİK YAZIŞMA VE PROTOKOL - Deneme Sınavı - 6

BAC is a fundamental/basic indicator not a subsidiary one.

SV (Schedule Variance): Schedule deviation as a monetary value. If SV is negative, that means the project is behind the plan against work performed. The opposite means the schedule is ahead of time.

BCWP or EV (Budgeted Cost for Work Performed): This value shows the cost for the work performed by the status date. However, please be careful, unit of this value is not man-hours, but monetary unit. That’s why it is also called earned value (EV) because you get a value as you perform work. It is calculated as follows:
BCWP=PCa*BAC

SV (Schedule Variance): Schedule deviation as a monetary value. If SV is negative, that means the project is behind the plan against work performed. The opposite means the schedule is ahead of time.
SV=BCWP-BCWS

Tardiness means delay. If an activity or a project delays, this situation may cause serious problems such as penalty payoff. That’s why tardiness is unwanted. In order to evaluate whether there is a tardiness for an activity, monitoring the performed workload or using a tracking Gantt chart is a good way.

The baseline plan is a master plan, which has been executed at the end of the planning phase of a project. It can not be changed. However, different plans may be constituted based on different scenarios. After declaring the baseline plan, the project team realizes activities based on this plan.

Tardiness means delay. If an activity or project delays, this situation may cause serious problems such as penalty payoff. That’s why tardiness is unwanted. In order to evaluate whether there is tardiness for an activity, monitoring the performed workload, or using a tracking Gantt chart is a good way.

In order to evaluate and control a project, you should follow these four steps:
1. Setting a baseline plan
2. Measuring progress and performance
3. Comparing plan with the actual
4. Taking action

Management of a project is a dynamic and compelling process as the project is under the effect of its environment. Any of contingency affects the project directly such as machine breakdown, lack of labour supply, weather conditions, the behaviour of competitors, government decisions, and so on.

Three important metrics can be used to define the size of a project: project completion time (PCT), budget, and workload. Project completion time is the difference between the latest finish date of the last activity and the earliest start date of the first activity of a project.

Since management of a project is a dynamic process, no matter how well it is planned, facing with deviations in terms of cost and workload is unavoidable. For example, a machine breakdown or an accident, which can not be estimated beforehand, may cause both extra cost and tardiness. Therefore, the project manager has to control whether jobs are performed according to their calendar after the project starts. Additionally, this control should be done in terms of cost and schedule (workload). If there are deviations according to the baseline plan such as exceeding budget or tardiness for some jobs, corrective actions should be taken immediately.

EVA was developed in 1967 by the US Department of Defence. It aims to clarify the performance of a project numerically. By using this technique, we can answer the following questions:
• Is the improvement of a project coherent with its baseline plan? (In terms of budget and workload)
• Are there differences between planned and actual cost and workload?
• If so, how far is the project from the plan?

After applying EVA, the step of taking action is realized, if needed.

There are two basic indicators to evaluate a project in terms of cost and workload. The first one is the cost performance index (CPI) and the other one is the schedule performance index (SPI). These values are positive, and if they equal to one, that means the project in on the way.

Subsidiary indicators are the side indicators that derive from fundamental indicators. However, they are useful to obtain information about projects quickly in monetary value

There are three metrics to define a project: Project completion time (PCT), budget, and workload. By calculating these values, the size of a project can be understood, and the project can be compared to others. Additionally, these metrics are also useful to monitor and evaluate a project after giving start because they are baseline plan metrics and used to clarify the improvement of the project by comparing actual cost and workload values for a status date.

BAC (Budget at Completion): BAC is budget of an activity or a project, and it is also called the baseline cost which means the cost of the baseline plan. It is calculated at the end of the planning phase. Of course, each activity has its own budget. Project budget is the summation of all activity budgets and other expenditures such as setup cost, fixed cost, and general expenses. Budget of an activity can be calculated as follows considering all costs: BAC=regular shift duration*regular shift rate +overtime duration*overtime rate + setup cost + fixed cost

BCWS or PV (Budgeted Cost for Work Scheduled): This value shows planned cost by the status date. It is also called the planned value (PV). BCWS is calculated as follows: BCWS=PCp*BAC

ACWP or AC (Actual Cost for Work Performed): This is actual spending by the status date. In other words, it is the real (current) cost of the project. Of course, it may be different from the BCWS and BCWP values.

BCWS or PV (Budgeted Cost for Work Scheduled): This value shows planned cost by the status date. It is also called the planned value (PV). BCWS is calculated as follows: BCWS=PCp*BAC

BCWP or EV (Budgeted Cost for Work Performed): This value shows the cost for the work performed by the status date. However, please be careful, unit of this value is not man-hours, but monetary unit. That’s why it is also called earned value (EV) because you get a value as you perform work.