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Construction
Management

CONSTRUCTION MANAGEMENT 1

Cost &
Schedule
Monitoring
and Control

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KEY DIFFERENCES BETWEEN EVM & EVA

EARNED VALUE MANAGEMENT (EVM) EARNED VALUE ANALYSIS (EVA)

Quantitative technique used to evaluate project
Is a method that combines cost, schedule, technical
performance:
scope, and risk aspects within EVA:
 analyzing schedule and cost variances.
 to gauge the actual progress of work
 Permits the project to be measured by progress
accomplished in a project.
achieved.
 uses EVA as one of its tools but is larger in scope.
 Measure amount of actual work performed on a
 uses EVA data in trends analysis and forecasting
project beyond the basic review of cost and
schedule reports.

Earned Value (EV) also defined as the Budgeted Cost of Worked Performed (BCWP) helps to
compute Performance Indices of a Project (Cost and Schedule Performance Indexes)

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COST & SCHEDULE MONITORING AND CONTROL

KEY DIFFERENCES BETWEEN CPI & SPI

COST PERFORMANCE INDEX (CPI) SCHEDULE PERFORMANCE INDEX (SPI):

 Indicator of cost efficiency  Indicator of schedule efficiency

 The ratio of Earned Value to Actual Cost  The ratio of Earned Value to Planned Value
 It states extra or fewer expenditure  States lag or ahead in time

 A ratio less than one indicates excess  A ratio of less than one indicates the project
spending, and greater than one indicates is lagging. In contrast, greater than one
better utilization of money. indicates more work done in the scheduled
time.

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EVM & EVA FORMULAS

Name / Abbreviation EVM EVA
Cost Performance Index CPI = (EV/AC) = (BCWP/ACWP)
Cost Variance CV = (EV - AC) = (BCWP - ACWP)
Schedule Performance Index SPI = (EV/PV) = (BCWP/BCWS)
Schedule Variance SV = (EV - PV) = (BCWP - BCWS)
Planned Value PV BCWP
Earned Value EV BCWS
Actual Cost AC ACWP

BCWS - Budget Cost of Work Schedule = (% of Planned Work to be Performed x Budget Cost)
BCWP - Budget Cost of Work Performed = (% of Work Performed x Budget)
ACWP - Actual Cost of Work Performed = (Actual Cost of Work Performed as per Accounting
Records)

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COST & SCHEDULE MONITORING AND CONTROL

EARNED VALUE ANALYSIS (EVA) INDICATORS

COST PERFORMANCE INDEX (CPI) Schedule Performance Index (SPI):

CPI = (BCWP / ACWP) ; CPI = ( EV/AC) SPI = (BCWP / BCWS) ; SPI = ( EV/PV )

If SPI = 1 or > 1, the SCHEDULE of

If CPI = 1 or > 1, the VALUE of Work
Work Performed is ON Schedule or
Performed is WITHIN BUDGET.
AHEAD of Schedule.
If CPI < 1, the VALUE of Work If SPI < 1, the SCHEDULE of Work
Performed is OVER BUDGET. Performed is DELAYED or BEHIND
Schedule.

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COST & SCHEDULE MONITORING AND CONTROL

Cost Baseline (S-Curve) Date of Analysis

Project Budget

Deadline
Actual Cost of Work
Performed (ACWP)
Budget Cost of Work
COST

Schedule (BCWS)
PV
Cost Variance AC
EV Schedule Variance

Budget Cost of Work

Performed (BCWP)

TIME

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CASE STUDY

Given the Project data below and the Planned S-Curve, what is the status of the Project if Activities 1.1
and 1.2 are 100% complete at the end of 3rd month with Activity 1.3 actual cost incurred amounting to
190,500.00?

Duration % Work
Item No. Site Budget Rel. Wt. M1 M2 M3 M4 M5 M6 Actual Cost
(mos.) Completed
86.76% 100.00%
WP1
73.53%
Start
61.37%
Activity 1.1 1 130,000 15.29% 130,000 100.00% 125,000
Activity 1.2 2 185,000 21.76% 38.33%
92,500 92,500 100.00% 180,000
Activity 1.3 3 310,000 36.47% 103,333.33 103,333.33 103,333.33 60.00% 190,500
15.29%
Activity 1.4 2 225,000 26.47% 112,500 112,500
0.00%
End
Total 850,000 100.00%
Duration M0 M1 M2 M3 M4 M5 M6
Monthly Cost - 130,000 195,833 195,833 103,333 112,500 112,500
% Monthly 0.00% 15.29% 23.04% 23.04% 12.16% 13.24% 13.24%
Cumulative Cost - 130,000 325,833 521,667 625,000 737,500 850,000
% Cumulative 0.00% 15.29% 38.33% 61.37% 73.53% 86.76% 100.00%

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CASE STUDY

Planned Value Earned Value Actual Value

(S-Curve) (SWA) (Accounting)

BCWS BCWP CV SV CPI SPI

Item No. Site Duration ACWP
(Activities) Budget (mos.) % Complete Amount % Complete Amount (Actual Cost) (BCWP-ACWP) (BCWP-BCWS) (BCWP/ACWP) (BCWP/BCWS)

WP1
Start
Activity 1.1 130,000 1 100% 100% 125,000
Activity 1.2 185,000 2 100% 100% 180,000
Activity 1.3 310,000 3 60% 190,500
Activity 1.4 225,000 2
End
TOTAL 850,000

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CASE STUDY

CALCULATION OF BCWS CALCULATION OF Cost Variance (CV)

BCWS = S-Curve planned accomp. x budget CV = BCWP - ACWP = EV - AC
Activity 1.1: BCWP = 100% x 130,000 = 130,000
Activity 1.1: CV = 130,000-125,000 = +5,000
Activity 1.2: BCWP = 100% x 185,000 = 185,000
Activity 1.2: CV = 185,000-180,000 = +5,000
Activity 1.3: BCWP = (521,667)- (130,000 +
Activity 1.3: CV = 186,000-190,500 = -4,500
185,000) = 206,667 (66.67%)

CALCULATION OF BCWP CALCULATION OF SCHEDULE Variance (SV)

SV = BCWP - BCWS = EV - PV
BCWP = % work completed x budget
Activity 1.1: SV = 130,000-130,000 = 0.00
Activity 1.1: BCWP = 100% x 130,000 = 130,000
Activity 1.2: SV = 185,000-185,000 = 0.00
Activity 1.2: BCWP = 100% x 185,000 = 185,000
Activity 1.3: CV = 186,000-206,667 = - 20,667
Activity 1.3: BCWP = 60% x 310,000 = 186,000

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CASE STUDY

Planned Value Earned Value Actual Value

(S-Curve) (SWA) (Accounting)

BCWS BCWP CV SV CPI SPI

Item No. Site Duration ACWP
(Activities) Budget (mos.) % Complete Amount % Complete Amount (Actual Cost) (BCWP-ACWP) (BCWP-BCWS) (BCWP/ACWP) (BCWP/BCWS)

WP1
Start
Activity 1.1 130,000 1 100% 130,000 100% 130,000 125,000 5,000 0.00
Activity 1.2 185,000 2 100% 185,000 100% 185,000 180,000 5,000 0.00
Activity 1.3 310,000 3 66.67% 206,667 60% 186,000 190,500 (4,500) (20,667)
Activity 1.4 225,000 2
End
TOTAL 850,000 521,667 501,000 495,500 5,500 (20,667)

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CASE STUDY

CALCULATION OF CPI CALCULATION OF CPI FOR THE PROJECT

CPI = (BCWP/ACWP) = (EV/AC) CPI (Project) = (Sum of BCWP/Sum of ACWP)
Activity 1.1: CV = (130,000/125,000) = 1.04 CPI = (501,000/495,500)
Activity 1.2: CV = (185,000/180,000) = 1.03 CPI = 1.01 > 1.0
Activity 1.3: CV = (186,000/190,500) = 0.98 The Project is WITHIN BUDGET

CALCULATION OF SPI CALCULATION OF SPI FOR THE PROJECT

SPI = (BCWP/BCWS) = (EV/PV) SPI (Project) = = (Sum of BCWP/Sum of BCWS)

Activity 1.1: CV = (130,000/130,000) = 1.00 SPI = (501,000/521,667)
Activity 1.2: CV = (185,000/185,000) = 1.00 SPI = 0.96 < 1.0
Activity 1.3: CV = (186,000/206,667) = 0.90 The Project is BEHIND SCHEDULE

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CASE STUDY

Planned Value Earned Value Actual Value

(S-Curve) (SWA) (Accounting)

BCWS BCWP CV SV CPI SPI

Item No. Site Duration ACWP
(Activities) Budget (mos.) (Actual Cost)
% Complete Amount % Complete Amount (BCWP-ACWP) (BCWP-BCWS) (BCWP/ACWP) (BCWP/BCWS)

WP1
Start
Activity 1.1 130,000 1
Activity 1.2 185,000 2 100% 130,000 100% 130,000 125,000 5,000 0.00 1.04 1.00
Activity 1.3 310,000 3 100% 185,000 100% 185,000 180,000 5,000 0.00 1.03 1.00
Activity 1.4 225,000 2 66.67% 206,667 60% 186,000 190,500 (4,500) (20,667) 0.98 0.90
End
TOTAL 850,000 521,667 501,000 495,500 5,500 (20,667) 1.01 0.96

Cost and Schedule Performance Index: CPI > 1 and SPI <1.0

Cost and Schedule Variance : CV = +5,000 and SV = - 20,645

The Project is WITHIN BUDGET and the Work Performed is BEHIND Schedule

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COST & SCHEDULE

MONITORING AND CONTROL

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1. What is the other definition of Earned Value (EV)?

2. What is the quantitative technique used to evaluate project performances by analyzing

schedule and cost estimates?

3. Imagine that the project you are handling is starting to fall behind schedule or exceed the project’s budget.
What actions would you take?
o Conduct a thorough analysis to identify the root cause of the delays or budget overruns.
o Communicate with the team and stakeholders to discuss possible solutions and implement corrective
actions immediately.
o All of the above

4. What is SPI and CPI in Earned Value Analysis?

5. How do you prioritize the necessary tasks of a project?

o Prioritize tasks based on their impact on the project’s critical path, deadlines, and dependencies.
o Use of project management tools/software to keep track of priority tasks.
o All of the above

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Group Workshop #06:

Using the Project Data and PDM Network shown below, perform an Earned Value
Analysis (EVA) and determine the project performance after the 25th day of the
project timeline and plot the EVA Curves.
Project Data
Duration
CODE DESCRIPTION BUDGET SWA Actual Cost
(Days)
A Layout foundation 40,450.00 2 100% 34,787.00
B Excavation 29,425.00 5 100% 28,836.50
D Place Concrete 296,382.00 3 80% 243,033.24
F1 Cut and Bend Reinforcement (Part 1) 132,468.18 5 100% 140,416.27
F2 Cut and Bend Reinforcement (Part 2) 65,245.49 2 100% 63,940.58
G1 Place Reinforcement (Part 1) 50,483.50 3 100% 53,007.67
G2 Place Reinforcement (Part 2) 24,864.99 2 100% 25,113.64
I Erect Formwork 65,787.50 5 100% 52,630.00
J Remove Formwork 12,210.00 3
K Clean Up 9,165.00 1

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Group Workshop #06:

Using the Project Data and PDM Network shown below, perform an Earned Value Analysis
(EVA) and determine the project performance after the 25th day of the project timeline and
plot the EVA Curves.

PDM Network

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