Chapter -5

Project Monitoring and Contro

l

Mohammed W. EiT-M Industrial Engineering Department

Project Monitoring
The set of procedures and management practices used to

collect information about the performance of a project

Performance Analysis
The process of determining

performance variances based

on monitored and forecasted performance

The purpose of Project Monitoring and Control is to make

necessary actions when the projects performance deviates

significantly from the plan.

Purpose
Monitor the actual values of the project planning

parameters against the project plan.

Performance

Time

Cost

The common reference is the original Plan or the

Budgeted cost and value curve

Project Control

Control process and activities needed to correct

deviations from plan

Control the triple constraints
time (schedule)
cost (budget, expenses, etc)
performance (specifications, testing results, etc.)

Monitoring and control as part of a feedback syst

em

Measuring Project Progress

Step 1. define original budget and weighs of its ac

tivities
Step 2. measure activity progress and actual cost
Step 3. calculate project progress as weighed sum

of activities

Measuring Project Progress [Example]

Step
1

Budget

Structur
es

Footings

Procuremen
t

Budgeted
Quantity

Unit
Cost

76

Activity
Weigh

1,100,001.
40
100%

Budget

148,200.0
0
13%

106,400.0
1400
0

72%

Step
2

Progress after 10 Months

Structu
res

Actual
Actual
Quanti
Unit Cost
ty

Footings

Procurement
Shipping
Construction

Columns

Procurement
Shipping
Construction

700,000.52

162,209.12
1500
118,500.00
203.28
16,059.12
350
27,650.00

537,791.40
3200
345,600.00
400
43,200.00
1379.55
148,991.40

79
79
79
108
108
108

Actual Cost
[10 months]

Step
3

Budget
Actual
Activity
ed
Activity Project
Quanti
Progres
Quantit
Weigh Progress
ty
s
56.48
y
%

Structu
res

Footin
gs

Procurem
ent
Shipping
Construct
ion

Colum
ns

Procurem
ent

104% 13%

14.0%

79
79

76
76

104%
104%

72%
10%

74.6%
10.7%

79

76

104%

18%

18.7%

108

49%
220

49%

87%
65%

42.5%
31.8%

Example (Continued)
Schedule:
Duration: 18 months
budget: 1,100,000 $
After 10 months:
Actual consumed cost: 700,000 $
Progress: 56.48%
And not 700,000/1,100,000 = 63.63 %

Look at the activity Progress Not at the cost progress !

Earned Value Analysis

Integrating cost, schedule, and work perform

ed by ascribing monetary values to each.

A way of measuring

overall performance (not in

dividual task) using an aggregate performance me

asure.
Earned value of work performed (value complete

d) for those tasks in progress found by multiplying

the estimated percent physical completion of wor
k for each task by the planned cost for those tasks

Earned Value Analysis

Earned value analysis has three major cost measur
ements:

budgeted cost of work scheduled(BCWS),

budgeted cost of work performed (BCWP),

Actual cost of work performed (ACWP)

BCWS: indicates the amount that should have been

expended for work scheduled during the reportin

g period
BCWP:indicates the number of dollars that should

Earned Value Analysis

Baseline cost to completion referred to as bu

dget at completion (BAC)

Actual cost to date referred to as estimated c

ost at completion (EAC)

Performance Indices
Cost

(spending) variance (CV) difference betwee

n budgeted cost of work performed (earned value)
(BCWP) and actual cost of that work (ACWP)
CV = BCWP ACWP (negative value - cost overru
n)
Schedule variance (SV) difference between earn
ed value (BCWP) and cost of work we scheduled to
perform to date (BCWS)
SV = BCWP BCWS (negative value - behind sch
edule)
Cost

Performance Index (CPI)=BCWP/ACWP

Schedule

Performance Index (SPI)= BCWP/BCWS

Fig. Areas of cost and time performance using Cost and Schedule performance
indexes

Possibilities Earned Value Analysis

Earned Value Chart basis for evaluating

cost & performance to date

Example

Duration (Months)
Cost (1000$)

D(2, 60)
C(4, 60)

H(3, 75)
G(5, 50)

A(2, 40)

I(1, 40)
E(4, 80)

B(2, 50)

J(5, 100)

F(3, 60)

Activit A B
y
ES
LS
Cost/Mo
nth

0
0
2

0
2
2
2
25 1

2
2
30

2
7
20

2
4
20

6
6
10

4
8
25

11
11
40

5
7
20

Time Scaled Network

(Earliest Start )

Time Scaled Network

(Latest Start )

Cumulative Costs

Example: Reviewing the project

Suppose at the end of 3 months we obtained t

he following:
a) Budgeted cost(BCWS) =175k$ [ From master sched
ule]
b)

Actual money Spent (ACWP)= 150k$

c)

Value of work Completed (EV or BCWP)=65

Activity A is completed [100%]=4

0k$
Activity C and D have not started
0k$

Example: Continued
Cost

(spending) variance (CV)= BCWP ACWP

o CV=65-150=- 85k$ [Overrun]
Schedule variance (SV)
o SV = BCWP BCWS=65-175=-110k $ [behind the sch
edule )
o 3-1.67=1.33 months behind the schedule
Cost

Performance Index (CPI)=BCWP/ACWP= 65/150=0.43

Schedule

0.37

Performance Index (SPI)= BCWP/BCWS=65/175=

EXAMPLE
Assume that operations on a Work Package cost 1,500$ to c
omplete. They were originally scheduled to finish today. At t
his point, we actually spent 1,350$. And we estimate that w
e have completed two thirds (2/3) of the work. What are the
cost and schedule variances?

CV = BCWP ACWP = 1500 (2/3) 1350 = - 350 [co

st overrun]
SV = BCWP BCWS = 1500 (2/3) 1500 = - 500 [Be
hind Schedule]
CPI = BCWP/ACWP = 1500(2/3)/1350 = 0.74
SPI = BCWP/BCWS = 1500(2/3)/1500 = 0.67
Spending higher than budget, and given what we h

ave spent, We have not completed as much wor

k as we should have

EXERCISE
A project to develop a country park has an actual co

st in month 17 of $350,000, a planned cost of $475,

000, and a value completed of $300,000. Find the co
st and schedule variances and the indexes.
$

Planned (Baseline) 475,000

Time t

BCWS

Actual cost 350,000

ACWP

Value completed 300,000

BCWP

Month 17

Solution
BCWS = 475,000
BCWP = 300,000

CV = BCWP ACWP
SV = BCWP BCWS

ACWP = 350,000

CV = 300,000 350,000 = -50,000 (negative value - cost overru

n)

SV = 300,000 475,000 = -175,000 (negative value - behind sch

edule)

Cost Performance Index (CPI) = BCWP/ACWP = 300/350 = 0.86

Schedule Performance Index (SPI) = BCWP/BCWS = 300/475 =

0.63

Forecasting Performance
Attempts to predict the conditions at a later time or th

e end of the project

Typically made repeatedly on a regular basis througho
ut a project
Estimate at completion
EAC = cost spent + estimate to complete

EAC = ACWP + (BAC BCWP) / CI

ACWP / BCWP = 1 / CI
EAC = BAC / CI

Example [EAC]
BAC=1,100
BCWP=621; ACWP=700
EAC=BAC/CI

CI= BCWP/ACWP=621/700=0.887
EAC= 1,100 /0.887 = 1,240,000 $
VAC variance at completion = 1,100 1,240 = - 140,000

Forecasting completion time

Actual completion date (AC)
AC = Current date + (Work remaining / Expected wo

rk rate)

T = current date (time now)

BC = budget completion time
Previous Example : T=10 months ; BC=18 months
AC=10+(1,100-621)x(18-10)/[(1,100 660)x(621/660)]
= 10+479 x 8/414 = 10 + 9.26 = 19 m + 8 days
Time overrun = 38 days