Question

The total plan for the project involved 1000 staff-days of value (the Budgeted at Completion or BAC) accumulated over 10 months with a staff of 5 full-time people. At the 4-month mark, with no open tasks, the total accumulated earned value is 320 staff-days. The plan at this point is for 340 staff-days to have been earned. Alas, the actual amount spent (because extra staff time has already been spent on this project) is 370 staff-days.

A summary of the facts:

1. Original project cost: 1000 staff-days

2. Original project schedule: 10 months

3. Planned value: 340 staff-days at 4 months

4. Actual cost: 370 staff-days

5. Earned value: 320 staff-days

6. Current monthly staff: 5 people

5. What is the projected total cost Estimate at Completion (EAC)?

a. If we assume cost variance was atypical (and the rest of the project will go as originally planned)?

b. If we assume cost variance was typical (and the rest of the project will have a proportional variance)?

c. If we assume we can re-plan the remaining project and make a whole new estimate?

6. What is the projected schedule Estimate at Completion (EAC)?

a. If we assume schedule variance was atypical (and the rest of the project will be as originally planned)?

b. If we assume schedule variance was typical (and the rest of the project will have a proportional variance)?

c. If we assume we can re-plan the remaining project and make a whole new estimate?

7. What are the remaining cost-to-complete and schedule-to-complete figures for each of a, b, and c?

8. What is the intensity of work required to finish the work with the available funds? (These funds can be defined as either the original Budget at Completion (BAC) or the current Cost Estimate at Completion (EAC).)

Answer 1

Original project cost: 1000 staff-days

Original project schedule: 10 months

Planned value: 340 staff-days at 4 months

Actual cost: 370 staff-days at 4 months

Earned value: 320 staff-days at 4 months

Current monthly staff: 5 people

5. What is the projected total cost Estimate at Completion (EAC)?

a. If we assume cost variance was atypical (and the rest of the project will go as originally planned)?

Since we assume that the rest of the project will go as planned, the cost variance at the completion of the project would be the cost variation at the end of the 4 months:

· Cost variation at the end of 4 months = Total Actual cost at the end of 4 months – Earned value at the end of 4 months

· Cost variation at the end of 4 months = 370 – 320 = 50 staff-days

· Projected Total cost estimate at completion = Original project cost + cost variation at the end of 4 months

= 1000 staff-days + 50 staff-days

=1050 staff-days

b. If we assume cost variance was typical (and the rest of the project will have a proportional variance)?

If we assume that the projected total cost variance at completion is proportional to the 4-month period, then we would have an additional cost of 50 staff-days for every 320 staff-days earned.

For a project requiring 1000 staff-days, the expected cost variance would be = (50/320) *1000

= 156.25 staff-days

Projected Total cost estimate at completion = Original project cost + expected cost variance

                                                                                = 1000 staff-days + 156.25 staff-days

                                                                                = 1156.25 (or 1157 staff-days rounded up)

c. If we assume we can re-plan the remaining project and make a whole new estimate?

If we assume that we can re-plan the remaining project to complete it within the next 6 months and 660 staff-days as planned, the cost variance would be

=              50 staff-days (at the end of 4 months) + (50/320) *660 staff-days

=              50 staff-days + 103.125 staff-days

=              153.125 staff-days

The new estimate would be

= Original project cost + cost variance for the remaining period

= 1000 staff-days + 153.125 staff-days

= 1153.125 staff-days (or 1154 staff-days rounded up)

6. What is the projected schedule Estimate at Completion (EAC)?

a. If we assume schedule variance was atypical (and the rest of the project will be as originally planned)?

If we assume schedule variance was atypical, the time variation would be the extra time needed to complete the 20 staff-days (340 - 320) we are behind on after the 4-month period. Since the original estimate is 340 staff-days in 4 months,

Time variation = (20 staff-days/340 staff-days) *4 months = 0.235 months

Project schedule estimate at completion = original project schedule + time variation

                                                                = 10 + 0.235 months = 10.235 months