Materials, % Complete and EVM

[Jeff Hutchinson, PMP]

Hi -
I am having trouble with accurate reporting when adding hardware
materials to my plan.

I am running a $266K project that is where duration % complete is 34%
and work % complete is 37% and I've actually only spent $77K. Sounds
pretty good right.

$100K of the $266K is for 4 servers and the software that is required.
I have added this $100K material resource to the resource pool and
assigned it to the "Order Hardware" activity in my project schedule.

When the "Order Hardware" activity is 0% complete, my CPI is around
1.2 and my SPI is around 1.09. Sounds great right.

Well we just ordered the server last friday so I want to update it to
100% complete. Only thing is then my project actual cost has just
increased by $100K and now my CPI is .5.

I am very particular in the way that I report project performance. I
use the Earned Value Management (EVM) methodology....reporting BAC,
AC, Planned % Complete, Actual $ Complete, PV, EV, SV and CV.

I want to show that I have purchased this $100K item but I don't want
it to show that I have grossly overbudget either.

Any ideas?

Thank you,
Jeff Hutchinson, PMP

 

[Steve House [MVP]]

How about showing the cost not in the "Order" task but in the "Install" task
where it is actually consumed? It didn't cost you 100k to order it - that
took a few hours clerical time and a long distance phone call.
Theoretically if you didn't install it your could return it for credit so
your $100k hasn't really been "spent" yet - purchasing it has simply
transformed one form of capital asset (money) into another form of capital
asset (computer hardware). The asset really isn't "spent" until you
incorporate it into the project deliverable. Would that give you a more
accurate picture?