EVA; BCWS 9,50,000, BCWP 8,00,000, ACWP 10,00,000

Data

BCWS = PV = Rs 9,50,000; BCWP = EV = Rs 8,00,000; ACWP = AC = Rs 10,00,000; BAC = Rs 50,00,000; reporting date = week 20 of 45 weeks.

Calculation

$$\begin{aligned} SV &= EV - PV = 8{,}00{,}000 - 9{,}50{,}000 = -1{,}50{,}000\\ CV &= EV - AC = 8{,}00{,}000 - 10{,}00{,}000 = -2{,}00{,}000\\ SPI &= EV/PV = 8{,}00{,}000/9{,}50{,}000 = 0.842\\ CPI &= EV/AC = 8{,}00{,}000/10{,}00{,}000 = 0.800\\ EAC &= BAC/CPI = 50{,}00{,}000/0.800 = 62{,}50{,}000\\ ETC &= EAC - AC = 62{,}50{,}000 - 10{,}00{,}000 = 52{,}50{,}000\\ VAC &= BAC - EAC = 50{,}00{,}000 - 62{,}50{,}000 = -12{,}50{,}000\\ \text{Forecast duration} &= 45/SPI = 45/0.842 = 53.4\ \text{weeks} \end{aligned}$$

Comment

• Schedule: SV is negative and SPI = 0.842, so the project is behind schedule. Only 84.2 % of the planned work is done. At this rate the project will take about 53.4 weeks instead of the planned 45 weeks (about 8.4 weeks late).
• Cost: CV is negative and CPI = 0.800, so the project is over budget. Each Rs 1 spent gives only Rs 0.80 of work.
• Forecast: if the present cost trend continues, the final cost will be Rs 62,50,000 against the budget of Rs 50,00,000 (variance at completion = -Rs 12,50,000).

Answer: SV = -Rs 1,50,000, CV = -Rs 2,00,000, SPI = 0.842, CPI = 0.800; the project is behind schedule and over budget.

Both schedule and cost are unfavourable. Controlling statements: increase productive resources (labour, equipment, extra shifts), improve supervision and productivity, review rates and wastage, re-sequence activities, and revise the plan or budget with the client's approval.

Features of the project

 Cost (Rs lakh)                     (not to scale)
  50 +                                    o BAC at week 45
     |                                 .
     |                            .   planned (PV) curve
     |                       .
  10 +            o AC
 9.5 +            o PV
   8 +            o EV
     |       .
     |   .
   0 +------------|-----------------------|---- weeks
     0            20                      45

• Planned progress = 9.5/50 = 19 %; earned progress = 8/50 = 16 %; money spent = 10/50 = 20 % of the budget.
• Since AC > PV > EV at week 20, the project is behind schedule and over budget (the worst situation).

Comment on each parameter

• SV = -Rs 1,50,000: work worth Rs 1.5 lakh that was planned is not yet done; the project is behind schedule.
• SPI = 0.842: only 84.2 % of the planned work is done.
• CV = -Rs 2,00,000: the work done cost Rs 2 lakh more than its budget.
• CPI = 0.80: each Rs 1 spent gives Rs 0.80 of work.
• EAC = Rs 62,50,000: if the trend continues, the project will cost Rs 12.5 lakh more than the BAC. ETC = EAC - AC = Rs 52,50,000 is still to be spent.
• Forecast duration = 45/0.842 = 53.4 weeks, about 8.4 weeks late.

Corrective action is needed: increase resources and productivity, control waste and unit rates, and revise the schedule.