Planning and Managing Project Budget Flashcards
Tools and Techniques for Estimating project cost
Analogous estimates - look at previous Bottom-up estimating- determine at lowest level Parametric Estimating- 3 Part Estimating- takes risk factors into account Expert Judgement Data Analysis PMIS Decision Making Techniques
Bottom Up Estimates
determine cost at lowest level and roll up
Use work breakdown structure
materials, labor, and contingency = total for workpackage
Cost aggregation
like bottoms up analysis
Reserve Analysis
Data Analysis for Estimating project cost
contingency reserves
management reserves
Tools & Techniques for Cost Control
Expert Judgement
Data Analysis- Reserve analysis, variance, trend analysis, earned value analysis
To-Complete Performance Index
PMIS
Reserve Analysis
Determine if reserves are good
Variance Analysis
actual vs planned performance (cost and schedule)
Trend Analysis
project performance over time, improving or declining
Earned Value Analysis
scope, cost, schedule
compare actual vs baseline
To-Complete Performance Index (TCPI)
work left / money left
Cost Variance (CV)
PV= planned value- value of work planned for now EV= earned value AC= actual cost - total incurred up to date
To-Complete Performance Index (TCPI)
work left / money left
what cost performance needs to be to complete on goal
TCPI >1 performance need to be better than planned to meet goal
if TCPI > CPI need to improve
TCPI= (BAC-EV) / (BAC-AC)
Estimated at Completion (EAC)
forecasting, estimate to complete project based on cost so far
Cost Performance Index (CPI)
CPI > 1 = project earning more than has been spent
CPI = EV/AC
Estimated at Completion (EAC)
forecasting, estimate to complete project based on cost so far
ID areas with higher cost
Bottom Up Estimate at Completion
EAC = AC + ETC
most common method to calculate EAC
EAC based on Budget VAlue
if cost is not going to change
AC + BAC - EV
EAC based on CPI
if basing on cost so far
BAC / cummulative CPI
EAC based on CPI
if basing on cost so far
BAC / cumulative CPI
EAC based on CPI and SPI
EAC = [(BAC-EV) / (CPI x SPI)] + AC
use if timeline is firm
Planned Value (PV)
authorized budget for work
= BAC x % of time passed
assumes the flow is equal throughout
Earned Value (EV)
budget for work complete
= BAC x % completed
Schedule Variance (SV)
difference of actual from plan
SV = EV - PV
positive variance means ahead of schedule
Schedule Performance Index (SPI)
= EV / PV
SPI > 1 means project is ahead of schedule
SPI of 1.20 = 20% ahead of schedule
Cost Variance (CV)
CV = EV - AC
positive variance means ahead of schedule
Cost Performance Index (CPI)
CPI = EV / AC
CPI > 1 means under budget
CPI of 1.07= for every $1 spent, get $1.07 value
