EARNED VALUES


Earned value is a project management technique that relates resource planning to schedules and to technical cost and schedule requirements. All work is planned, budgeted and scheduled on time-phased "planned value" increments constituting a cost and schedule measurement baseline. There are two major objectives of an earned value system: to encourage effective internal cost and schedule management systems and to be able to provide timely and reliable data produced by these systems for determining project delivery status.
IBM® Rational® Portfolio Manager is unique in that it calculates Earned Values metrics at the resource assignment level. When a project baseline is created, each assignment is individually base-lined and the information is stored on a weekly basis.
This information is then aggregated for each task, parent deliverable and then the project itself. This design provides great flexibility in that Earned Values performance may not only be tracked and displayed for tasks and projects but for individual resources and resource pools as well.

Earned Value Behavior 

Obtaining Earned Value metrics in IBM Rational Portfolio Manager relies on specific settings;
  1. Application Administration: in order to compensate for timesheet entry delays and Earned Value calculations, the EV Delay setting that is found in the Application Administration/General tab must be set.
    The optional possible values range from 0 to 8. The values represent the number of weeks prior to the current week up to which IBM Rational Portfolio Manager will calculate Earned Value. This ensures that any process around time entry, submission and approval have been completed prior to the metrics being calculated. The net effect is to ensure that the Earned Value calculations are based on complete weeks of time entry.
    The EV delay is also presented in the Single Project EV report. This reporting visibility allows the user to know that the EV calculation has a delay of number of weeks based on the parameters entered in the General tab of Application Administration.
  2. Project Level: a project level setting that indicates whether Earned Value metrics are to be calculated against certain projects. This setting is found in the Project Description view, Settings portlet.


This setting is used to ensure that Earned Value is not calculated unnecessarily against duration based projects or any project where time entry is not being captured. Since IBM Rational Portfolio Manager uses project baseline information to provide performance variances that do not rely on Earned Value metrics, this setting is used to define whether Earned Value metrics are calculated on a project by project basis and only on those projects required.

Earned Value Displays

Earned Value in IBM Rational Portfolio Manager can be viewed in two ways:

  1. WBS View: the WBS view contains an Earned Value Band that contains headers (sub-columns) that display the calculated Earned Value metrics for project where Earned Value tracking is required.
  2. Earned Value Pivot: the IBM Rational Portfolio Manager Portfolio Viewer contains an Earned Value OLAP (On-line Analytical Processing) pivot that allows the user to manipulate the Earned Value metrics data dimensions to view aggregate information by week, month, quarter or year as well as by project, resource pool or individual resource.

It also provides the ability to view the information graphically.

Earned Value Calculations

The following table includes the Earned Value fields in IBM Rational Portfolio Manager with the formulas used to calculate the information:

Header Definition Formula
EARNED VALUE  

Earned Value Displays

Earned Value in IBM Rational Portfolio Manager can be viewed in two ways:

  1. WBS View: the WBS view contains an Earned Value Band that contains headers (sub-columns) that display the calculated Earned Value metrics for project where Earned Value tracking is required.
  2. Earned Value Pivot: the IBM Rational Portfolio Manager Portfolio Viewer contains an Earned Value OLAP (On-line Analytical Processing) pivot that allows the user to manipulate the Earned Value metrics data dimensions to view aggregate information by week, month, quarter or year as well as by project, resource pool or individual resource.

It also provides the ability to view the information graphically.

The Earned Value header displays the date for which the Earned Value is valid. Since team members continue to enter time past this date, once the earned value has been calculated the EV (BCWPRoll Up ), BAC and EAC remain constant until such time as the background execution has been performed. The AC (ACWP) is updated immediately when additional time is entered and the resulting indices calculations are performed. Since these values are based on up to date EV (BCWP) they may not reflect the current situationRoll Up
BAC Budget at Completion

The sum total of the task or project time-phased budget

Sum of the assignment baseline effort * assignment baseline cost
ETC Estimate to Complete BAC - ACWP (BAC - AC)
EAC Estimate at Completion

The expected total cost of an activity or project when the defined scope of work is completed

ACWP + ETC (AC + ETC)
ACWP (AC) Actual Cost of Work Performed (Actual Cost) Sum of the (assignment actual regular effort * assignment actual regular cost ) + the sum of  (assignment actual special effort * assignment actual special cost )
BCWS (PV) Budgeted Cost of Work Scheduled (Planned Value) Accumulated weekly baseline work in hours * Baseline hourly rate
BCWP (EV) Budgeted Cost of Work Performed (Earned Value) Current task level percent complete (%C) * BAC
VAC (CVAC) Variance At Completion (Cost Variance At Completion)

The difference between the budget at completion less the estimate at completion

BAC - EAC negative result indicates the task or project is over budget
SV Schedule Variance

The difference between the scheduled completion of an activity and the actual completion of that activity

BCWP - BCWS (EV - PV)
CV Cost Variance

The difference between the estimated cost of an activity and the actual cost of that activity

BCWP - ACWP (EV - AC)
SPI Schedule Performance Index

The ratio of schedule efficiency that indicates the percent of work performed out of the total work scheduled

BCWP / BCWS (EV / PV) A number less than 1 indicates that the project is behind schedule.
CPI Cost Performance Index

The ratio of cost efficiency or value earned per unit actual cost. A number less than 1 indicates that the project is spending more money than budgeted

BCWP / ACWP (EV / AC) A number less than 1 indicates that the project is spending more money thRoll Up an budgeted.
Critical Ratio   Critical Ratio = SPI*CPI
SAC Schedule At Completion Latest baseline duration
TV Time Variance Time Variance between BCWP and BCWS (EV and PV) in Weeks
PC Percent Complete

Budgeted Cost of Work Performed divided by Budget At Completion multiply by 100

(BCWP / BAC) * 100 ((EV / BAC) * 100)
TCPI To Complete Performance Index

The difference between Budget At Completion and Budgeted Cost of Work Performed divided by the difference between Budgeted At Completion and Actual Cost of Work Performed

(BAC - BCWP) / (BAC - ACWP) ((BAC-EV) / (BAC-AC))
SVAC SPI Schedule Performance Index At Completion

Budget At Completion multiply by Schedule Performance Index minus 1

BAC * (SPI - Roll Up 1)
SVAC CR Critical Ratio At Completion

Budget At Completion multiply by Critical Ratio minus 1

BAC * (CR - 1)
TEAC Time Estimate At Completion

Schedule At Completion divided by Schedule Performance Index

SAC / SPI
TVAC Time Variance At Completion

Schedule At Completion minus Time Estimate At Completion

SAC - TEAC
ECD Estimated Completion Date Latest Baseline Finish

WEB SERVICES

The web services API currently supports only the reading of the Earned Value fields for the WorkElement tree , provided that Earned Value exist  for the related container and that the required
scope is used : WorkElement.setEarnedValues(true).

Once scope has been set and loading has been done via Xpath , it is possible to get Earned Values with : WorkElement.getEarnedValues()


GENERATING EARNED VALUES VIA WEB SERVICES

The web services API also provides all the required functionalities to create and generate earned value information without using the client.

Four methods has been added to the Application interface to facilitate the means:

EnableProjectEVECalculation

This method must be called on the project to signal that we want Earned Value calculations to be done, failing to do so will result in no data generated for E.V. . This is a project level setting that indicates whether Earned Value metrics are to be calculated against certain projects.

ActivateEVWeekDelays

The optional possible values range from 0 to 8. The values represent the number of weeks prior to the current week up to which IBM Rational Portfolio Manager will calculate Earned Values.

SaveProjectBaseline

Save Baseline function copies all planned dates and budgets into baseline dates and budget.

The impacts of Copy Planned to Baseline are shown below:

RollupProjectEV

This method must be called after each update to force the re-calculations of Earned Values.

   

Here are the steps for generating Earned Values data using the web services API:


  1. Create project
  2. Set project setting to activate EV calculationsby using: ApplicationInterface.enableProjectEVCalculation(String sessionID, RPMObject projectObject, RPMObjectScope scope)
  3. Set number of weeks to consider in calculation by using: AppplicationInterface.activateEVWeekDelays(String sessionID, int evDelays)
  4. Add Task to project as child
  5. Create Pool
  6. Create Resource
  7. Create, bind and save calendar, rates to resource
  8. Create ResourceTaskAssignment, TaskAssignment and bind to Task.
  9. Copy proposed to plan 
  10. Save Baseline by using: ApplicationInterface.saveProjectBaseline(String sessionID, RPMObject projectObject, RPMObjectScope scope)
  11. Rollup Project by using: ApplicationInterface.rollupProjectEV(String sessionID, RPMObject projectObject, RPMObjectScope scope)

Earned Value Code Samples