BCWP Constrained by Start Date

[Ken]

Using Project 2002, the simplified problem is:

If I enter a % Complete for a project, a BCWP will not
show up until the start date has occurred. Even after
the start date, BCWP is still constrained by the time-
phasing of the task. How do I get BCWP to ignore the
time phasing of the task?

For example, I am one day into a three day task, I want
to be able to set my % Complete to 66% and have the BCWP
reflect 66% of the cost. Currently, the BCWP max would
be 33% of the cost.

 

[Steve House]

You're trying to redefine BCWP. Earned value compares the work that has
been performed by a certain date with the work that was expected to be
performed by that date. The status date is a critical part of the
definition. In the example you gave, Earned Value is telling you that
you're a day ahead of schedule. Another problem is that % Complete in
Project refers to duration, not work nor physical complete - if work or
physical complete is of interest there are separate fields for them and
you can choose either % Complete or % Physical Complete for earned value
calculations in the Options menu. So if you're one day into a 3 day
task, you're 33% complete. You can't do two days work in one days time,
just can't be done. If you're 66% done after one day, the duration was
wrong to begin with and needs to be changed.

 

[Ken]

Steve,

I have a specific example that has caused the problem. I
have a three day task to order $30,000 in parts. That's
prorated for $10,000 a day. On day 1, I allocate $20,000
for one high cost part. I still require the 2 additional
days to order the rest of the parts. The work to order
the parts is an overhead function and not included in the
task.

Unfortunately, the reporting period ends with day one.
Therefore, I would like to show that I spent $18,000
instead of the budgeted $20,000 with my earned value
report.

Can I load resources or costs within a task in order to
do this? Otherwise, I would still like to get BCWP to
ignore the time phasing of the task.

Thanks,
Ken

 

[Steve House]

No offense intended but you are using BWCP in a very strange way it
appears, at least as far aas I can tell. Budgeted Cost of Work
Performed is fundamentally the cost of the work involved in doing the
task - it is actually a measurement of schedule performance with the
work done by the resource, expressed in terms of the dollars you've paid
to do it, plus materials consumed. That is why you cannot ignore the
time phasing of the task - BWCP is fundamentally time phased data and
without the time information it is essentially meaningless. This is
the opposite of what you say you're doing when you say the work is
overhead and not part of the task. The cost of the task is in fact the
cost necessary to accomplish the work of getting the parts, NOT the cost
of the parts being ordered. The parts cost is figured into the cost of
the task later on that actually consumes them, not the task that
acquires them.

Where did the figure $18,000 for Monday come from anyway? You said
three days for $30 in parts. Disregarding that this is the wrong place
in the budget (IMHO) to reflect that cost anyway, $18k after day 1
doesn't jive with anything - the part was $20k, so that says Mon should
get $20k, the total was $30k, prorating gives $10k for Mon. The other
options are to accrue the total cost at either the start or end of the
task - that says either Mon gets the whole $30k or Wed (day 3) gets the
whole amount. But no schedule I can see comes up with $18k for Mon.

I'm building a brick walkway. I earn $10/hour. It takes me a day to
locate and order the special bricks we want, including a $25 in phone
calls to track down the only dealer in North America that carries this
special brick. I order $5000 worth. My bricklayer gets $25 / per hour
and after the bricks arrive it takes him 3 days to lay all the bricks.
My project has two tasks...

1. Order 500 bricks @ $10 per brick - duration 1 day - cost $105, $80
labour plus $25 phone, prorated
2. Lay bricks - duration 3 days - cost $5600, $600 labour plus $5000 br
icks, prorated

1 day into the bricklaying task, assuming everything on schedule, BWCP
will be $80 + $200 + $25 + $5000/3 or about $1972.

or, my original bricklayer has gotten sick and I had to substitute one
who gets $30 per hour. At the end of Day 1 of bricklaying the BCWP is
still $1972 but the ACWP is now $2012. We're on schedule but over
budget.

Hope this helps

--
Steve House
MS Project MVP
Visit http://www.mvps.org/project/faqs.htm for the FAQs

 

[Ken]

Steve,

I think I skipped a couple of steps in my example.

When I said the work was overhead, what I meant was that
the person who orders material in our company does not
charge to a specific project. Therefore, they're time
does not cost the project anything. The only thing I
have to pay for is the material. So the task will take
three days, but only costs me the $30,000 budgeted for
the material.

I got ahead of myself with the $18,000. That was
supposed to represent an actual cost to a budgeted of
$20,000. I wanted to show some variance.

You mentioned that parts may have a better place in the
budget, other than as a fixed cost in a task. Is
material meant to go elsewhere in Project?

My basic problem still is. I'm one day into a task and
have to show my earned value. I've spent $20,000 (not
$18,000 as in my previous example) of a $30,000 task. I
want to enter 66% Work Complete and an Actual Cost of
$20,000. It sounds like my BCWP could be $30,000 (front
loaded), $10,000 (prorated), or $0 (back loaded). It
cannot be $20,000 (Work Complete x baseline budget),
which is what I want to show.

Currently, my company performs the earned value
calculations in Excel. It's time consuming to get the
data from Project into the spreadsheet formulas that
we're using. My desire is to show that Project can come
up with the same numbers as in the current spreadsheet.
Unfortunately, my above example does not agree with the
Excel spreadsheet, since the spreadsheet uses % Complete
x Baseline Cost to get BCWP.

Thanks,
Ken

 

[Steve House]

Material costs go with the task that consumes them, not the task that
acquires them. You can enter them as either consumables in the resource
assignments - ie, John 100%, Bill 100%, Bricks 50@$10ea - or as a fixed
cost if that works better in your circumstance. The problem is not that
you are entering the parts as a fixed cost but you are attributing that
cost to the wrong task - the materials cost of the task that orders the
parts is the actual cost of placing the order if any - telephone,
travel, etc - while the cost of the parts themselves is a cost of the
task that actually uses them. Their cost should go against the task
that they are being ordered for and are NOT a cost of the task that
orders them. A material cost is the cost of things that are to be
physically incorporated into the deliverable itself or such things as
fuel that are consumed in the creation of it.

Does it take 3 days to actually place the order or is that the delivery
time, BTW?

A work around that might work for you, if you really HAVE to associate
the parts costs with placing the order by edict from a higher paygrade,
is to make the ordering into two or three subtasks under a summary
"Order Parts", make the first one a 1 day duration task to order the Big
Part with a cost of $20000, and order the rest of the parts in one or
two tasks totaling 2 days duration and $10000 in costs.



--
Steve House
MS Project MVP
Visit http://www.mvps.org/project/faqs.htm for the FAQs

 

[Ken]

Steve,

Thanks for your help. Unfortunately it doesn't look like
Project does want I want (right or wrong). The good news
is that the abnormality will be corrected the next month.

The 3 days for placing orders is just meant as the time
period to place the orders in.

Ken