EVM – Earned Value Management
EV = BAC * %complete
EV = PV * %complete (any point during project execution)
EV = BCWP (budgeted cost of work performed)
PV = BCWS (budgeted cost of work scheduled)
AC = ACWP (actual cost of work performed)
SV = EV – PV > 0 good
SPI = EV/PV > 1 (ahead of schedule)
CV = EV – AC > 0 good
CPI = EV/AC >1 (under budget)
PV = SV/(SPI – 1)
AC = CV/(CPI -1)
=============================
EAC = AC + bottom-up ETC: when initial estimates are flawed
EAC = AC + (BAC – EV): when ETC is predicted to be done at budgeted rate (typical)
EAC = BAC/CPI: when ETC is expected at current CPI (typical)
EAC = AC + (BAC-EV)/(SPI*CPI): at current SPI, CPI
EAC = BAC-CV?
ETC = EAC – AC: assuming that work goes as plan
ETC = BAC – EV
VAC = BAC – EAC
%VAC = VAC/BAC
TCPI = (BAC-EV) / (BAC-AC): accepting BAC Value
TCPI = work remaining / funds remaining
TCPI = (BAC-EV) / (EAC – AC): when BAC is not sufficient and EAC is calculated
TCPI > 1 is Bad
=============================
Expected Monitory Value: EMV = Impact * Probability
=============================
Communication Channels = N*(N-1)/2
7% of communication messages is contained in words
38% in vocal pitch
55% in body language
Albert Mehrabian’s book “Silent Message”
=============================
TEAM Stage – Tuckman (Jensen) Ladder
forming
storming
norming
performing
adjourning
=============================
Future Value & Present Value
FV = PV * (1+r)^N : r – rate of interest; N – number of time periods
PV = FV / (1+r)^N
NPV: higher is better, NPV>0 investment will add value, accept project. NPV is defined as:
The difference between the present value of cash inflows and the present value of cash
outflows.
Internal Rate of Return IRR: bigger is better
Benefit Cost Ratio BCR: Bigger is better
Payback Period: lesser is better. This is nothing but breakeven period.
Payback period = Net investment / Avg annual cash flow.
=============================
Probability Distribution
PERT: Normal: (P+4M + O)/6
Triangular: (P+M+O)/3
SD of activity = (P-O)/6
Var =
=============================
Float = Slack = total sack = LS – ES = LF – EF
float = 0 for activities on critical path
=============================
Cost of Quality, CoQ = EFTW + COPQ = POC + PONC
Essential First Time Work
Cost of Poor Quality
Price of Conformance
Price of Non-Conformance
=============================
Depreciation/Straight-line depreciation = Asset cost / Useful life
Double declining balance = 2*[(Asset Cost – Accumulated Depreciation) / Useful life]
=============================
5 Level of Estimates
ROM (Rough Order of Magnitude): -25% to +75%
Preliminary Estimate: -15% to +50%
Budget Estimate: -10% to +25%
Definitive Estimate: -5% to +10%
Final estimate: 0%
=============================
Remember, RETURN = Net Income Before Tax (NIBT) *or* Net Income After Tax (NIAT); &
ON means ‘/’
Return on Sales, ROS = NI*T/Total Sales
Return on Assets, ROA = NI*T/Total Assets
Return on Investment, ROI = NI*T/Total Investment
Working Capital = Current Assets – Current Liabilities
Discounted cashflow = Cashflow * Discount factor
=============================
Contract related formulas
Savings = Target cost – Actual cost
Bonus = Savings*Percentage
Contract cost = Bonus + Fees
Total cost = Actual cost + Contract cost
=============================
Point of total assumption
PTA = [(Ceiling Price – Target Price)/Buyer’s Share Ratio] + Target Cost
Cost to buy = Initial cost + [#months * (monthly maintenance costs)] lifecycle cost = total
cost + maintenance and support cost for lifetime of product
=============================
Normal Distribution
1 sigma = 68.26%
2 sigma = 95.46%
3 sigma = 99.73%
6 sigma = 99.999%
1 SD = 1 sigma
=============================
What Five Strategic Considerations may result in authorization of a project? (MOCkTaiLS –
MOCTLS)
Market demand
Organizational need
Customer request
Technological advances
Legal requirements
Social need
=============================
EVA = Net Operating Profit After Tax – Cost of Capital (Revenue – Op. Exp – Taxes) –
(Investment Capital X % Cost of Capital)
EVA: Economic Value Add Benefit Measurement – Bigger is better
Source Selection = (Weightage X Price) + (Weightage X Quality)
=============================
Types of powers of PM:
Legitimate
Reward
Expert
Referent
Coersive/Punishment
=============================
Motivational theories
Hertzbergs highgyene-motivation
Maslow’s hierarchy of needs
McGregor Theory X, Y; / Z(assurance of permanent job position)
McClelland’s Need Theory
Victor Vroom Expectance theory
=============================
Peter Principle=Halo effect
=============================
range of variance on a budgetary estimate can be from -10% to +25%.
=============================
Paul Hersey/Ken blanchard’s Situational continuum/leadership
change leadership style based on maturity of subordinates/team.
S1: Telling; S2: Selling; S3: Participating; S4: Delegating;
system testing vs integration testing
Seven Quality Mgmt and Control tools(NP, MAP IT)
=============================
Network diagram
PDPC
Matrix diagram
Affinity diagram
Prioritization Metrics
Interrelationship digraphs
Tree diagram
=============================
7 Basic Quality Tools (See See See, Husband and Father Playing Soccer)
Check sheet
Control chart
Cause-and-effect diagram
Histogram
Flow chart
Pareto chart
Scatter diagram
=============================
type II error – beta risk
ACTIVITY ON ARROW/arrow diagramming method
=============================
McKinsey’s 7S’s – Robert H. Waterman, Jr. and Tom Peters
Hard Elements
Strategy
Structure
Systems
Soft Elements
Shared Values
Skills
Style
Staff
=============================
7 reasons of conflicts on projects
schedule
project priorities
human resources
technical opinions and performance trade-offs
administrative procedures
personality conflict
cost and budget
=============================
Conflict management style
withdraw/avoid
compromise
smoothen/accommodate
collaborating
confront/problem solving
force
Collaborating: win/win;
Compromising: win some/lose some; >> lose/lose
Accommodating: lose/win;
Competing: win/lose;
Avoiding: no winners/no losers
=============================
Test of Normality
Paired Comparison Analysis
opm3
management by objective
capability maturity model
tqm
Merrill and Reid in their employee motivation theory?
personality traits: driver, expressive, amiable, and analytical.
=============================
Joseph Juran:applied the Pareto principle to quality issues
“Juran’s Trilogy”: quality planning, quality control, and quality improvement.
=============================
W. Edwards Deming
PDCA – along with Shewart
Philips Crosby – DIRFT (4 principles)
The definition of quality is conformance to requirements (requirements meaning both the
product and the customer’s requirements)
The system of quality is prevention
The performance standard is zero defects (relative to requirements)
The measurement of quality is the price of nonconformance
Vilfredo Federico Damaso Pareto
80-20 principle
Kaoru Ishikawa
root-cause diagram: fishbone
KJ Diagram ()
William Ouchi (jap)
Theory Z, permanent job offer
Genichi Taguchi
Design of experiments
F.C. Moore
“Delegation means assigning work to the others and giving them authority to do so”
=============================
Overlapping relationship
Sequential relationship
Multi-phase relationship
Iterative relationship
=============================
Predictive/plan-driven
Iterative and Incremental
Adaptive/Agile
=============================
critical chain methd by Eliyahu M. Goldratt
The critical path method (CPM) is a project modeling technique developed in the late 1950s
by Morgan R. Walker (of DuPont) and James E. Kelley
Parkinson’s law is the adage which states that “work expands so as to fill the time available
for its completion”.
Student’s syndrom – work is done at the last moment before deadline
=============================
Group decision making criteria (BINAM)
Brainstorming
Idea/mind mapping
Nominal technique
Affinity diagrams
Multi-criteria decision analysis
=============================
Failure mode and effect analysis – FMEA
QFD – quality function deployment (type of Facilitated workshops)
=============================
Discrete, Apportioned, Level of Effort – EMV effort types
=============================
marginal analysis
lifecycle costing
deming’s 14 points?
ARMA>
zero sum processing
issue log
=============================
shannon-weaver model of communication
=============================
code of ethics: Respect, Responsibility, Honesty, Fairness >>>> Aspirational and
Mandatory
=============================
direct, indirect, fixed, variable costs
=============================
