Guide - Section 2.7 (Deck#5) - Measurement Performance Flashcards
WHAT TO MEASURE: Business value, Stakeholders, Forecasts
What are used to ensure the project deliverable stays aligned to the business case and the benefits realization plans?
Business value measurements
Metrics that measure financial business value include:
- Cost-benefit ratio
- Benefits delivery vs business case
- Return on investment (ROI)
- Net present value (NPV)
(CBR, BD, ROI, NPV)
A measure of the expected present value of an investment with the initial cost that is used to determine if the costs of a project outweigh its benefits.
cost-benefit ratio =
Expected Present Value of Benefits / Expected Present Value of Costs
What does a cost-benefit ratio greater than 1 indicate?
The project should not be considered unless there are regulatory, social good, or other reasons to do the project.
What does a benefit-cost ratio greater than 1 indicate?
the project should be considered
A measure of the amount of financial return compared to
the cost
Return on investment (ROI)
The difference between the present value of inflows of capital and the present value of outflows of capital over a period of time
Net present value (NPV)
Stakeholder satisfaction can be measured with
- Surveys (or inferring satisfaction or lack of)
- Metrics - Net Promotor Score (NPS), Mood Chart, Moral, Turnover
What measures the degree to which a stakeholder (usually the customer) is willing to recommend a product or service to others?
Net Promotor Score (NPS)
It measures a range from -100 to +100.
A high NPS indicates?
A high Net Promoter Score not only measures satisfaction with a brand, product, or service, it is also an indicator of customer loyalty.
What can track the mood or reactions of a group of very important stakeholders—the project team?
A mood chart
At the end of each day, project team members can use colors, numbers, or emojis to indicate their frame of mind.
Project teams use what to consider what might happen in the future so they can consider and discuss whether to adapt plans and project work accordingly?
forecasts
What are a few examples of qualitative forecasts?
Qualitative forecasts are based on expert judgment and subjective opinions rather than on numerical data.
Examples include: expert judgement, surveys (mood chart, morale), turnover
Name 6 types of quantitative forecasts?
(ETC, EAC, VAC, TCPI, RA, TA)
- Estimate to complete (ETC)
- Estimate at completion (EAC)
- Variance at completion (VAC)
- To-complete performance index (TCPI)
- Regression analysis
- Throughput analysis
An earned value management measure that forecasts the expected cost to finish all the remaining project work?
Estimate to complete (ETC)
How do you calculate ETC?
There are numerous methods to compute the value of additional periods estimated to complete the remaining scope
ETC = estimate at completion (EAC) - actual cost (AC)
ETC = (BAC - EV) / (CPI x SPI)
ETC = (BAC - EV) / CPI
ETC = (BAC - EV) / (CPI x SPIt)
An earned value management measure forecasts the expected total cost of completing all work?
Estimate at completion (EAC)
How do you calculate EAC?
There are a number of ways to calculate EAC
based on the assumption that past performance and efficiency will continue into the future EAC = AC + (BAC - EV) / CPI
An earned value management measure that forecasts the amount of budget deficit or surplus.
Variance at completion (VAC) = BAC - EAC
An earned value management measure that estimates the cost performance required to meet a specified management goal by taking the “work remaining” and divides it by the “funds remaining.
To-complete performance index (TCPI) =
(BAC − EV) / (BAC − AC)
What does a TCPI more than 1 indicate?
The project is under budget - this may create opportunities to increase quality or profit.
TCPI = 1 indicates the project is on budget
TCPI < 1 indicates the project is over budget
An analytical method where a series of input variables are examined in relation to their corresponding output results in order to develop a mathematical or statistical relationship.
Regression analysis
There are different types of regression analysis, including linear regression, logistic regression, and polynomial regression.
How are regression anaylysis used?
- to analyze the interrelationships betwenn different project variables that contributed to the project outcomes to improve performance on future projects.
- to identify the strength and direction of the relationship between variables.
- to make predictions about future outcomes based on past data.
This analytical method assesses the number of items being completed in a fixed time frame.
Throughput analysis
Features complete vs. features remaining, velocity, and story points are examples of?
Throughput metrics
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Project teams that use adaptive practices evaluate their progress and estimate likely completion dates using?
Throughput metrics
What can be used to verify and update cost estimates?
Using duration estimates
and burn rates of stable project teams
