forProject Encyclopedia

0/100 Method

The 0/100 Method is an earned value technique that earns no credit for a Work Package or task until it's fully complete. At that point, it earns 100% of its budgeted value at once.

50/50 Method

The 50/50 Method is an earned value technique that earns 50% of a Work Package's or task's budgeted value when it starts, and the remaining 50% when it's completed.

Accrual

An Accrual is the recording of actual costs for work that has been performed but not yet paid for. Sometimes called "Estimated Actual Costs."

Actual Cost

Actual Cost is another name for Actual Cost of Work Performed (ACWP) — the real cost incurred for work completed in a given period.

Actual Cost of Work Performed (ACWP)

Actual Cost of Work Performed (ACWP) is the cost incurred and recorded in accomplishing the work performed within a given time period, including all recorded incurred costs plus estimated actuals.

Applied Direct Costs (ADC)

Applied Direct Costs are the actual direct costs of labor, material, and other resources, recognized in the period they're used rather than when they're paid for.

Apportioned Effort (AE)

Apportioned Effort is an Earned Value measurement method that is applied in cases where accomplishment is measured in relation to a related, directly measurable task.

Authorization to Proceed (ATP)

Authorization to Proceed (ATP) is the official go-ahead for a contractor to begin work, typically issued by the procuring contracting officer.

Authorized Unpriced Work (AUW)

Authorized Unpriced Work (AUW) is new work scope the customer has formally authorized and had estimated, but hasn't yet negotiated a price for.

Authorized Work

Authorized Work is the work scope on a contract or project that management has formally authorized to be performed.

Baseline

In EVMS, "Baseline" refers to the approved plan — cost, schedule, and technical scope together — against which a project's cost and schedule performance is measured throughout its life.

Baseline Change Control

Baseline Change Control is the formal process used to establish, record, analyze, and communicate approved changes to the Baseline Plan.

Baseline Change Request (BCR)

A Baseline Change Request (BCR) is the formal document that proposes a change to the baseline, along with its justification and its impact on scope, cost, and schedule.

Baseline Plan

The Baseline Plan is the approved, integrated cost, schedule, and technical plan for a project, used as the standard for measuring performance.

Basis of Estimate (BOE)

A Basis of Estimate (BOE) is the documented rationale behind a cost or resource estimate for a specific piece of project scope.

Bill of Material (BOM)

A Bill of Material (BOM) is a listing of all the material items required to produce a single unit of a product.

Budget

In EVMS, a Budget is the approved resource estimate for performing a defined scope of work within the established schedule baseline. Budgets at various levels roll up into the project's overall Budget at Completion (BAC), and when time-phased the budget is referred to as BCWS.

Budget at Completion (BAC)

Budget at Completion (BAC) is the total authorized budget for accomplishing all of the defined work in a project or a sub-element of a project such as WBS Element, Control Account, Work Package, or Planning Package.

Budgeted Cost for Work Performed (BCWP)

Budgeted Cost for Work Performed (BCWP), also called Earned Value, is the budgeted value of the work actually accomplished on a project. It may be measured for a specific period or cumulative to date.

Budgeted Cost for Work Scheduled (BCWS)

Budgeted Cost for Work Scheduled (BCWS), also called Planned Value, is the time-phased distribution of budget for any project element based on the work that is scheduled to be accomplished over time.

Charge Number

A Charge Number is a generic name for the authorization code for a specific piece of work, at the lowest level tracked, to which a performing organization charges labor, materials, and other project costs.

Contract Budget Base (CBB)

The Contract Budget Base (CBB) is the Negotiated Contract Cost plus the estimated cost of any Authorized Unpriced Work — the total budget authorized under the contract.

Contract Target Cost (CTC)

Contract Target Cost (CTC), also called Negotiated Contract Cost, is the negotiated cost of the original contract plus all definitized contractual changes, excluding any authorized but unpriced changes.

Contract Target Price (CTP)

Contract Target Price (CTP), for Government contracts, is the negotiated contract cost plus the target profit or fee.

Contract Type

Contract Type refers to the various forms a contract can take for acquiring goods or services, such as Cost Plus Fixed Fee, Cost Plus Incentive Fee, Firm Fixed Price, Fixed Price Incentive Fee, or Unit Price.

Control Account (CA)

A Control Account (CA) is the key management point where scope, schedule, cost, and risk are managed together, and where Earned Value data is typically collected.

Control Account Manager (CAM)

The Control Account Manager (CAM) is the individual directly responsible for managing a Control Account, including its scope, schedule, cost, and technical performance.

Control Account Plan (CAP)

A Control Account Plan (CAP) is a document or electronic plan that compiles a Control Account's scope, schedule, and budget information into a single, integrated plan of performance.

Cost Performance Index (CPI)

Cost Performance Index (CPI) is a measure of cost efficiency, calculated as the ratio of earned value (BCWP) to actual cost (ACWP). CPI can be calculated both for the current period and cumulative to date.

Cost Variance (CV)

Cost Variance (CV) is the difference between earned value (BCWP) and actual cost (ACWP), and is a measure of cost efficiency. CV can be calculated both for the current period and cumulative to date.

Direct Costs

Direct Costs are costs that can be specifically identified with a particular contract or project and are charged to it directly — for example materials, labor, subcontractor charges, or other direct costs such as travel.

Discrete Effort

Discrete Effort is a classification that identifies work that will earn value based on objective or measurable outputs or work products.

Discrete Milestone Method

The Discrete Milestone Method is a way of applying the Weighted Milestone Method in which each milestone is all or nothing — its full weight is earned when it's complete, and nothing is earned before.

Distributed Budget

Distributed Budget is the sum of the budgets, direct and indirect, that have been allocated to Control Accounts and Summary Level Planning Packages through the Control Account planning and Work Authorization process.

Earned Standards Complete Method

The Earned Standards Complete Method is an earned value technique that credits progress based on accomplishment of pre-established labor-hour standards for each unit of work completed.

Earned Value (EV)

Earned Value (EV) is another name for Budgeted Cost for Work Performed (BCWP) — the value of work actually completed, expressed in terms of its original budget.

Earned Value Management (EVM)

Earned Value Management (EVM) is a management approach that integrates a project's scope, schedule, and cost to give objective, data-driven performance measurement and more realistic forecasting.

Earned Value Management System (EVMS)

An Earned Value Management System (EVMS) is the combination of processes, people, and information and tools that enables an organization to practice effective Earned Value Management.

Earned Value Method

An Earned Value Method (EV Method) is the specific technique chosen in advance to measure how much earned value (BCWP) a Work Package has achieved as work progresses.

Elements of Cost (EOC)

Elements of Cost (EOC) are the major categories — such as labor, material, subcontract, and overhead — into which a project's direct and indirect costs are planned and recorded.

Equivalent Units Method

The Equivalent Units Method is an earned value technique that credits partial progress on a unit of work, not just fully completed units.

Estimate at Completion (EAC)

Estimate at Completion (EAC) is the projected total cost of all authorized work, equal to actual costs incurred to date plus the estimated cost to complete the remaining work.

Estimate to Complete (ETC)

Estimate to Complete (ETC) is the projected cost of finishing all remaining authorized work from this point forward.

Estimated Actual Costs

Estimated Actual Costs are reasonable estimates of costs already incurred for completed work that haven't yet been posted in the formal accounting system.

EV Milestone

An EV Milestone is a subdivision of a Work Package, defined so that earned value can be measured at a finer level than the Work Package as a whole.

General & Administrative (G&A)

General & Administrative (G&A) is an indirect cost category that allocates a company's corporate home office and administrative expenses across all of its contracts.

Horizontal Schedule Integration

Horizontal Schedule Integration means Work Packages and tasks are logically sequenced and linked to their interdependencies across the same level of the schedule, including hand-offs between different teams.

In-Scope Change

An In-Scope Change is a baseline change that falls within the existing scope of a contract and therefore doesn't require a formal contract modification.

Independent Estimate at Completion (IEAC)

An Independent Estimate at Completion (IEAC) is a cost forecast calculated using a standard formula based on past performance, used to sanity-check the manager's own Estimate at Completion.

Indirect Costs

Indirect Costs are costs incurred for common or shared business objectives that can't be traced to a single specific contract or project.

Integrated Master Plan (IMP)

The Integrated Master Plan (IMP) is an event-based project plan made up of a hierarchy of events, each supported by specific accomplishments, and each accomplishment tied to criteria that must be met to consider it complete.

Integrated Master Schedule (IMS)

The Integrated Master Schedule (IMS) is a detailed, networked schedule containing all the Work Packages, Planning Packages, and lower-level tasks needed to support a project's events, accomplishments, and criteria.

Integrated Product Team (IPT)

An Integrated Product Team (IPT) is a multidisciplinary team given management responsibility for one or more elements of a project.

Integrated Risk Assessment (IRA)

An Integrated Risk Assessment (IRA) is an analysis that combines a program's separate technical, schedule, and cost risk assessments into a single probabilistic view of overall program cost.

Internal Re-planning

Internal Re-planning is any change to a project's budgets that stays within the existing contract scope and within the approved budget ceiling.

IPT Leader

An IPT Leader is the individual identified as responsible for an Integrated Product Team (IPT).

Latest Revised Estimate (LRE)

The Latest Revised Estimate (LRE) is a Control Account Manager's most current estimate of cost at completion, broken out by element of cost, for a given Control Account, as approved by the Program Manager.

Level of Effort (LOE)

Level of Effort (LOE) is work of a general or supportive nature — such as supervision or contract administration — that doesn't produce a definite end product.

Management Reserve (MR)

Management Reserve (MR) is budget held in reserve for unknown but in-scope effort — work that will be needed but cannot be identified in advance.

Master Budget Log

The Master Budget Log is a document that tracks how a project's performance budgets have been distributed over its life, including changes to Control Accounts, Undistributed Budget, and Management Reserve.

Measured Milestone

Measured Milestone is a way of applying the Weighted Milestone Method in which partial progress can be claimed within a milestone, rather than waiting for it to be fully complete.

Milestone Method

The Milestone Method is an earned value technique that breaks a discrete Work Package into several weighted milestones, each representing a portion of the Work Package's overall scope and budget.

Negotiated Contract Cost (NCC)

Negotiated Contract Cost (NCC) is the negotiated cost of the original contract plus all negotiated contractual changes, not counting any authorized but unpriced work.

Organizational Breakdown Structure (OBS)

The Organizational Breakdown Structure (OBS) is the organizational structure — including major subcontractors — responsible for accomplishing a project's authorized work.

Other Direct Cost (ODC)

Other Direct Costs (ODC) are costs charged directly to a project that don't fall under the main direct cost categories of labor or material.

Out-of-Scope Change

An Out-of-Scope Change is a baseline change that falls outside the existing contract's scope, meaning it requires a formal contractual change to implement.

Overhead

Overhead is a category of Indirect Cost covering shared costs that support a particular function, facility, or business unit rather than any single project.

Percent Complete

Percent Complete is a general measure of progress on a task or Work Package, expressed in various ways depending on what's being measured.

Percent Complete (EV Method)

Percent Complete (EV Method) is an earned value technique in which a Work Package earns credit based on an assessment of how much of its work is complete.

Percent Spent

Percent Spent measures how much has been spent on a task so far compared to its total expected cost.

Performance Measurement Baseline (PMB)

The Performance Measurement Baseline (PMB) is the time-phased baseline budget against which Control Account performance is measured. It is the sum of all budgets, both direct and indirect, that have been allocated to Control Account and Summary Level Planning Package elements, plus the amount temporarily held in Undistributed Budget.

Performing Organization

The Performing Organization is the organizational unit — typically a functional department or group — that applies resources to actually carry out a Work Package.

Physical Percent Complete

Physical Percent Complete is the assessed progress of actual work accomplished on a task, independent of the passage of time against its schedule.

Planned Value (PV)

Planned Value (PV) is the time-phased budget for the work scheduled to be performed — the same figure as Budgeted Cost for Work Scheduled (BCWS).

Planning Package

A Planning Package is a future portion of work within a Control Account that hasn't yet been broken down into detailed Work Packages.

Program Manager (PM)

The Program Manager (PM) is the individual with overall responsibility for the cost, schedule, and technical performance of a program, including the budgets and baseline changes authorized within it.

Quantifiable Backup Data (QBD)

Quantifiable Backup Data (QBD) is the objective, verifiable evidence used to support an assessment of work accomplished — the documented basis behind a percent complete claim.

Responsibility Assignment Matrix (RAM)

The Responsibility Assignment Matrix (RAM) is a chart showing how Work Breakdown Structure elements map to the organizations responsible for completing them.

Responsible Organization

The Responsible Organization is the organizational unit accountable for completing a defined scope of work within its cost, schedule, and technical objectives.

Schedule Variance (SV)

Schedule Variance (SV) is the difference between earned value (BCWP) and planned value (BCWS), calculated as SV = BCWP - BCWS.

Statement of Work (SOW)

A Statement of Work (SOW) is the document that defines the work scope of a program, project, or a specific element such as a WBS element, Control Account, or Work Package.

Summary Level Planning Package (SLPP)

A Summary Level Planning Package (SLPP) is an element that represent far-term work that under a summary WBS element that is not yet practical to break into detail Control Accounts and Work Packages.

To Complete Performance Index (TCPI)

The To Complete Performance Index (TCPI) measures the cost efficiency that must be achieved on the remaining work in order to meet a specific cost target.

Total Allocated Budget (TAB)

The Total Allocated Budget (TAB) is the sum of all budget allocated to a contract, made up of the Performance Measurement Baseline (PMB) plus Management Reserve (MR).

Undistributed Budget (UB)

Undistributed Budget (UB) is a temporary holding account for budget tied to authorized work that hasn't yet been planned in detail at the Control Account or Summary Level Planning Package level.

Units Complete Method

The Units Complete Method is an earned value technique that measures progress as the ratio of units completed to date over the total number of units required.

Validation

Validation is the formal recognition by an independent party that a company's Earned Value Management System (EVMS) meets the guidelines of ANSI/EIA-748.

Variance Analysis Thresholds

Variance Analysis Thresholds are the dollar-amount and percentage criteria, set by the Project Manager, that determine when a Control Account Manager must complete a Variance Analysis Report.

Variance at Completion (VAC)

Variance at Completion (VAC) is the difference between the Budget at Completion (BAC) and the current approved Estimate at Completion (EAC), showing whether a project is expected to finish over or under budget.

Vertical Schedule Integration

Vertical Schedule Integration is the practice of tying higher-level summary schedules to lower-level, detailed schedules so that data is consistent across all levels of the project's schedule hierarchy.

WBS Dictionary

The WBS Dictionary is a document that gives a brief narrative definition of each element of the Work Breakdown Structure, describing its work scope and deliverables.

WBS Element Manager

A WBS Element Manager is the individual assigned responsibility for accomplishing the work identified for a summary-level WBS element, above the Control Account level.

Weighted Milestone Method

The Weighted Milestone Method is an Earned Value technique in which Work Package Milestones are defined, with earned value credited on a discrete (0/100) basis as each milestone is completed.

Work Authorization (WA)

A Work Authorization (WA) is the document that formally assigns responsibility and authority for a defined element of work, within a specified schedule, budget, and Statement of Work.

Work Breakdown Structure (WBS)

The Work Breakdown Structure (WBS) is a product-oriented, hierarchical breakdown of all the work to be performed on a project, organizing hardware, software, services, and other deliverables into a single unifying structure.

Work Package (WP)

A Work Package (WP) is a natural subdivision of the tasks or activities within a Control Account, and the point at which work is planned, progress is measured, and earned value is computed.