Let us suppose you are managing a portfolio of projects in an IT department of a Bank. Many IT departments like this have literally hundreds of projects. How could you know the real status of each project in the portfolio? The best way would be to build a Portfolio Scorecard with two street lights (red, yellow, green) for every project, describing how the project is doing in terms of Time and Budget.
A good practice is to collect the values of the four basic variables in EVM (BAC, PV, EV, AC) for all projects in the project portfolio at the end of the month.
BAC = Budget at Completion, the total budget of the project.
PV = Planned Value, the sum of all planned taks until today.
EV = Earned Value, the degree of progress in every deliverable until today.
AC = Actual Cost, how much have we spent un the porject until today.
Then, with these four variables, we could build CPI, SPI, EAC and other EVM indicators.
CPI = Cost Performace Index = EV / AC.
SPI = Schedule Performace Index (...) Read more? Sign up for free