- Problem Definition
Following my Week 14 assessment of IEAC, 4 methods were used to calculate the EAC.
After reviewing each method, IEAC 3 was determined to be the most suitable however this still implied that the Estimated Cost at completion would be some 183% above original Budget. This is unrealistic and would appear to be an over estimate of remaining cost.
Another method is now required to determine the IEAC and this weeks blog will assess further alternatives.
2. Feasible Alternatives
Last week we considered IEAC1-4 which can be described as;
- IEAC1 = ACWP + ((BAC – BCWP) / CPI)
- IEAC2 = ACWP + ((BAC – BCWP) / SPI)
- IEAC3 = ACWP + ((BAC – BCWP) / CPI * SPI)
- IEAC4 = ACWP + ((BAC – BCWP) / ((0.2 * SPI) + (0.8 * CPI))
This week we will assess the IEAC using pproductivity and unit cost referred to as IEAC 5.
3. Development of the Alternatives
IEAC 5 method considers the Actual productivity or unit cost of work completed to date as the basis for predicting the cost of balance works.
As noted in my week 13 blog, BCWS,BCWP and ACWP figures during Week 0 were calculated in line with the nominated split and weightages provided in notes. This has created some inconsistencies in the reporting figures where by earned values are limited by an pre determined arbitrary weighting which is misaligned with BCWS and ACWP figures – wrongly indicating that productivity is low.
As such, inclusion of week 0 figures in any productivity assessment would not provide an accurate indication of how many hours (or cost) have been spent to date on actual tasks to establish a correct unit cost.
As such we will exclude week 0 costs and earned value and make an assessment of Productivity based on week 1 to 13 only.
Table 1 below summarises budget and estimate productivity based on the total work units required to completed the course;
CPI is based upon comparison of Budget and Actual unit cost of for works completed from weeks 1 to 13 and indicates that 3 out 5 are operating under budget.
Unit costs associated with weekly blogs and reports are however significantly over budget when considered on a unit cost basis.
Table 2 further outlines the IEAC for method 5.
4. Selection Criteria
The same selection criteria is to be applied as per week 13 blog.
- Realistic
- Reduce chance of further increases / changes
5. Comparison of the Alternatives
Table 3 outlines comparisons between all 5 methods
IEAC 5 provides the lowest IEAC ($27,717) compared to the previously preferred methods IEAC 1 & 4 ($33,233) which was also determined using CPI figures without any allowance for week 0.
6. Selection of Alternatives
IEAC 5 is considered more appropriate as a method for assessing my own IEAC. It ignores the week 0 anomalies and uses the actual unit cost of works completed so far to estimate . Unit costs do however still include learning curve inefficiencies during early phases and as such, productivity is expected to improve and assist with final cost
7. Performance Monitoring
Current Dashboard to include weekly assessment of IEAC based on unit productivity and cost – excluding week 0 figures.
References
- W09_SJP_Forecasts retrieved 5 November 2107 from https://js-pag-cert-2017.com/w09_sjp_forecasts
- Chapter 9.5 – Performance Monitoring Progress – Guild of project controls compendium and reference (CaR) | Project Controls – planning, scheduling, cost management and forensic analysis (Planning Planet). Retrieved from http://www.planningplanet.com
- National Defence Industrial Association. (2014). A Guide to managing programs using predictive measures.
