CECONMA LQ2 Flashcards
started in the 1960s as a method for integrated project cost and schedule control
Earned Value Management
Objectives of EVM
For effective internal cost and schedule management control systems
For more reliable and timely data to determine product-oriented contract status
Five steps in EV analysis
Determine (work)
Determine (money)
Calculate
Analyze
Extrapolate
represents the baseline schedule and budget
budgeted amount of cost for work scheduled to be accomplished plus the amount or level of effort or apportioned effort scheduled to be accomplished in a given time period.
Budgeted cost for work scheduled (BCWS)
contractor’s earning for work performed, based on the contract price (earned value)
the budgeted amount of cost for completed work, plus budgeted for level of effort or apportioned effort activity completed within a given time period.
Budgeted cost for work performed (BCWP)
represents the actual costs spent so far
the amount reported as actually expended in completing the work accomplished within a given time period.
Actual cost for work performed (ACWP)
T or F: Minor variances are usually expected and tolerated
True
T or F: Major variances aren’t always investigated
False
T or F: For a negative variance (schedule or cost), it could be an indication of underperformance or unrealistic baseline
True
T or F: A large positive variance may not be a reason for celebration. It may indicate an error or an overestimation in the baseline budget and/or schedule.
True
T or F: Schedule performance and budget
performance are dependent of each other.
False
Earned value (BCWP) and actual cost (ACWP) may be plotted against the baseline (BCWS) as shown below. Both curves are usually extrapolated to forecast what
estimate at
completion (EAC) and the
date of completion.
Part of project control focused on quality feedback, progress of work, prognosis
Monitoring
Part of project control focused on revisions and adjustments
Updating
Parts of Project Control
- Budget control
- Schedule control
- Quality
- Safety control
Tasks in Monitoring Project
- Feedback from direct contact
- Feedback from photography
- Feedback from check-off list
- Feedback from Gantt charts
- Feedback from networks
Tasks in Updating Project
- Correction of the target plan to economically meet the project’s overall
objectives - Planning and scheduling the remaining work after some time interval has
elapsed.
Factors affecting updating phase
- Errors in activity durations and network logic
- Changes in project design or in project scope
- Procurement
- Impending strikes, jurisdictional disputes, and sudden changes in the availability of workers
- Accidents
a schedule that is prepared by the contractor, usually before the start of the project, and is used for performance comparison.
Baseline Schedule
reflects actual performance information—including time of occurrence and amount (or percentage) of work completed - on the schedule and indicates on the schedule any changes to future work.
Updated Schedule
date on which all progress on a project is reported. It is also called the as-of date, the cut-off date, and the status date.
Data Date
Type of information needed for updating schedules
- Past information
- Future information
Most common frequency of updating
Weekly and biweekly schedule updates
Methods in measuring work progress
- Involves mainly
calculating or estimating
the percent complete for
each activity. - May also include
estimating the percent
complete for the entire
project
Methods for Determining Percent Complete for Individual Activities
- Units completed
- Cost or time ratio
- Start-finish
- Supervisor’s opinion
- Incremental milestones
- Weighted or equivalent units
- Works well for activities with small, identical, repetitive components
- E.g. laying bricks or CMUs (concrete masonry units), excavating, installing tile or carpet
Units completed
applies to those activities that are continuous and uniform throughout the project, such as Safety Inspection and project management–type activities.
Cost or Time Ratio
- Works best for small activities or those with no duration or a short duration.
- Project manager may assign one of
three stages: have not started yet (0%), started but not yet finished (an arbitrary amount, say, 40% or 50%), or finished (100%).
Start-Finish
- Most subjective method
- Used when no other method can be
suitably applied - Relies totally on the foreman or
supervisor judgment
Supervisor’s Opinion
- More suitable for large and complex or multistage activities.
- Each stage of a given activity is assigned a “weight” that is approximately equal to its percentage share of effort in the total activity.
- Then, each stage is treated as “all or nothing.”
Incremental Milestones
Steps in computing Weighted /Equivalent Units
- Assign a weight to each sub-activity so that total weight = 100%.
- Multiply the weight of each sub-activity by the quantity of the total activity. is the “equivalent weight” in units for each sub activity.
- Determine the percent complete for each sub-activity by using one of the previously discussed methods.
- Multiply the percent complete for each sub-activity by its equivalent weight. result is the “earned quantity.”
- Add earned quantities for all activities and divide by total quantity.
Methods for Determining Percent Complete
for the Entire Project
- Units completed
- Cost/budget
- Man-hours
- Duration
- Workday unit
Cost/budget formula
Baseline Cost/Budget Method:
Percent complete = Budgeted cost to date/Baseline budget
Actual Cost/Budget Method:
Percent complete = Actual cost to date/Estimated cost at completion
represents percent complete that is supposed to be achieved at this point.
Baseline Ratio
Man-hour Formula
Baseline Man-Hour Method:
Percent complete = Budgeted man-hours to date/Baseline man-hours
Actual Man-Hour Method:
Percent complete = Actual man-hours to date/Estimated man-hours at completion
Duration Formula
Baseline Duration:
Percent Complete = (Data Date − BL Start Date)/Total BL Duration
Actual Duration:
Percent Complete = Actual Duration/At Completion Duration
- Based on the assumption that activities have weights that are proportional to their durations
Workday Unit
Ways to Evaluate and Forecast
Bar chart and S-curve
a plot of targeted costs versus time with the appearance of letter ‘S” that has been somewhat flattened.
S-curve
Assignment of the required resources to each activity, in the required amount and timing
Resource Allocation/Resource Loading
Process of making adjustments to reduce the demand for resources on various project dates.
Schedule non-critical activities at times other than their earliest possible time
Resource Leveling
Sharing of resources among projects
MULTI-PROJECT RESOURCE LEVELING
Objectives of Resource Leveling
- To meet the physical limits of the resource
- To avoid the day-to-day fluctuations in resource demands
- To maintain an even flow of application for the resource
Types of Resource Leveling
- Limited RL (Traditional)
- Unlimited RL
Minimization of the duration time of the project while keeping the resource limits fixed.
Limited Resource Leveling
Minimization of the levels, and thereby the cost, of the resource while holding to the CPM project duration.
Minimum Moment Algorithm
Unlimited Resource Leveling
represent the demands for the resource over the time duration of the project.
Daily Resource Sums
The length of time an activity can be delayed without delaying the
entire project.
Float / Total Float / Slack
Time span in which the completion of an activity may occur and not delay the finish of the project nor delay the start of any following activity
Amount of leeway of an activity if all the activities of the project are to be started at their earliest possible time
Free Float
The time span in which the completion of an activity may occur and not delay the
termination of the project, but within which completion will delay the start of some following activity
Interfering Float
The amount of leeway an activity can have and not be affected by the early or late starts and finishes of any of the other activities.
Independent Float
Disadvantages of Traditional Approach
Procedure tends to cause a buildup of resources towards the end of the project.
Procedure permits fluctuations to remain in the resource histogram when the demand is below the assumed limit.
There is a possibility that the project duration may need to be extended to accommodate the assumed resource limit.
Time consuming.
Causes of Shifting
Delaying the start of an activity to any date up to and including its late start date.
Interrupting an activity and resuming it later (breaking the activity into two or
more segments) but finishing it no later than its late start date.
Fluctuating the amount of resources assigned to an activity, day to day, according to resource availability, until the activity gets all the required resource demand.
Types of Compacting Equipment
- Impact – sharp blow
- Pressure – static weight
- Vibration – shaking
- Kneading – manipulation or rearranging
Types of Excavators
Two types
* Front shovel (Power shovel) – to excavate usually in levels higher than the ground level
* Back shovel (Backhoe) – to excavate usually in levels lower than the ground level
Two types based on control method
*Cable control
*Hydraulic control
Excavator Mounting Types
Truck Mounting
Crawler Mounting
Wheel Mounting
Types of Tower Cranes
Top Slewing Tower Crane
Bottom Slewing Tower Crane
Types of Mobile Cranes
Crawler
Telescoping Boom Truck Mounted
Lattice Boom Truck Mounted
Rough Terrain Crane
All Terrain Crane
Modified Crane for Heavy Lifting
Loading and Hauling Equipment
Dozer - Crawler and Wheel Type
Loader - Track Type and Wheel Type (Straight or Articulated)
Scraper
Dumptruck
Off-highway Truck
Dozer Blade Adjustments
Tilting
Pitching
Angling
Types of Dozer Blades
Straight
Angle
Universal
Cushion
Parts of Front Shovel Excavator
Boom
Arm/Stick
Stick Cylinder
Bucket
Bucket Cylinder
Boom Cyinder
Parts of Backhoe
Boom
Dipper Arm Cylinder
Dipper Arm
Dipper Cylinder
Attachment Hoist Cylinder
Types of Cranes
Mobile
Tower
Types of Attachments for Backhoe
Draglines and Clamshells
Orange Peel Bucket
Used to handle and transport bulk material, such as earth or rock, to load trucks from stockpiles, to excavate earth and to charge aggregate bins at asphalt and concrete plants
Loader
Types of Loader Attachments
Tractor shovel, scoop loader, frontend loader, bucket loader, tractor shovel
Types of Concrete Equipment
Truck Mixer
Truck Mounted Pump
Walk-behind single rotor trowel
Ride-on double rotor trowel
tracking performance
Monitoring
taking the necessary steps to correct unfavorable situations
control
Cost control includes what
- cost estimating
- cost accounting
- project cash flow
- company cashflow
- direct labor costing
- overhead rate costing
- other tactics, penalties, incentives, profit-sharing
Phases of a Management Cost and Control System
Phase 1 - Planning
Phase 2 - Work Authorization and Release
Phase 3 - Cost Data Collation and Reporting
Phase 4 - Cost Accounting
Phase 5 - Customer and Management Reporting
Purposes of Control
Verification process and decision-making
Operating Cycle Components
Phase 2-4
management technique that relates resource planning to schedules and technical performance requirements.
Earned value
a systematic process that uses earned value as the primary tool for integrating cost, schedule, technical performance management, and risk management.
Earned Value Management (EVM)
Benefits of EVMS
- Accurate display of project status
- Early and accurate identification of trends
- Early and accurate identification of problems
- Basis for course corrections
is defined as any schedule, technical
performance, or cost deviation from a specific plan.
variance
Methods of measuring variance
Measurable efforts, level of effort
Any difference between the budgeted cost of an activity and the actual cost of that activity
Cost Variance (CV)
Any difference between the scheduled
completion of an activity and the actual completion of the activity
Schedule Variance
Any difference between the budgeted cost of an activity and the actual cost of that activity
Cost Variance (CV)
Any difference between the scheduled
completion of an activity and the actual completion of the activity
Any difference between the scheduled
completion of an activity and the actual completion of the activity
Schedule Variance (SV)
the cost efficiency ratio of earned value to actual costs, expressed as the formula CPI =BCWP/ACWP or CPI = EV/AC. It is often used to predict the magnitude of a possible cost overrun using the formulaBAC/CPI = projected cost at completion or EAC.
the cost efficiency ratio of earned value to actual costs
It is often used to predict the magnitude of a possible cost overrun
Cost Performance Index (CPI)
the schedule efficiency ratio or earned value accomplished against the planned value.
describes what portion of the planned schedule was actually accomplished.
Schedule performance index (SPI)
sum of all budgets (BCWS) allocated to the project. This is often synonymous with the project baseline. This is what the total effort should cost.
Budget at Completion (BAC)
identifies either the dollars or hours that represent a realistic appraisal of the work when performed. It is the sum of all direct and indirect costs to date plus the estimate of all authorized work remaining
Estimate at Completion (EAC)
reports that indicate the physical progress to date of BCWS, BCWP, and ACWP
may also include information on material procurement, delivery, and usage
Performance reports
These reports identify where we are today and use the information from the performance reports to calculate SV and CV
Status Reports
Reports that calculate EAC, ETC, SPI, and CPI and other forward-looking projections
emphasize where company will end up
Projection Reports
These reports identify exceptions, problems, or situations that exceed the threshold limits on such items as variances, cash flow, resources and others
Exception Reports
Response to Variance Reports
Ignoring it
Functional Modification
Replanning
System Redesign
An indicator, used in the formal discipline of cost-benefit analysis, that attempts to summarize the overall value for money of a project or proposal.
the ratio of the benefits of a project or proposal, expressed in monetary
terms, relative to its costs, also expressed in monetary terms. All benefits and costs
should be expressed in discounted present values.
Benefit-Cost Ratio
The planned allotment of time and cost for unforeseeable elements that may be associated with project planning.
A planned reaction or response established to address an event that may or may not happen
Contingency
The summation of the cost baseline and the management reserve.
Contact Cost
The summation of the contract cost and the profit anticipated.
Contract Price
Changes made to bring expected future performance of the project in line with the plan.
Actions taken to return project performance to the planned level or performance or to an acceptable level.
Corrective Action
The process of controlling variances to the planned costs of a project.
Managing to remain within a predetermined project budget throughout its various stages or phases.
Cost Control
The sum of money that is released using the work authorization forms (usually associated with the allocation of project funds to each project phase).
Distributed or time-phased budget
The number of labor units required to complete an activity or other project element.
Usually expressed as staff hours, staff days, or staff weeks
Effort
An assessment of the likely quantitative result.
Usually applied to project costs and durations and should always include some indication of a range of accuracy such as plus or minus a given percent.
Estimate
A sum of money or a percent of the estimated cost that is
added into the cost baseline for possible inaccuracies in the estimating process.
Management Reserve
The uncontrolled and unauthorized changes to the project scope.
Usually results in greater cost, lower quality, and unfavorable performance variances.
Scope Creep
A sum of money that you intend to spend but that hasn’t been allocated yet to the work breakdown structure elements or possibly to work authorization forms.
Undistributed Budget
Salaried Staff and Hourly Workers are under what
Labor
mandates the fixing of the minimum wages applicable to different industrial sectors, namely, non- agriculture, agriculture plantation, and non plantation, cottage/handicraft, and retail/service, depending on the number of workers or capitalization or annual gross sales in some sectors.
Wage Rationalization Act or Republic Act No. 6727
Sectors included in RA 6727
- Agriculture
- Retail Establishment
- Service Establishment
Normal Working hours per day
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