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PRIYANSHU KUMAR

ROLL NO 1311314
ASSIGNMENT 2: Ariba Implementation at Med-X: Managing Earned Value (EV)
Introduction
MED X Inc. a global pharmaceutical giant has seen a sustained growth ever since its inception. In
order to maintain its competitive advantage the company has decided to closely monitor the
procurement process and make it more efficient. For this they have roped in Implementation
Technologies, to install its Ariba application to transform the existing set of procurement procedures
into a decentralized purchasing model having a self-service philosophy. This process will help in
streamlining the process between suppliers and MED-X while ensuring better connectivity, reducing
cycle time and cost involved.
At present Christopher Martin of Implementation technologies is facing a challenge of completing
the implementation project on time. In order to gain the insights on the various problems that the
project may be facing an earned value analysis is to be conducted.
Earned Value Analysis
Software Customization

Monthly Plan

Monthly status

Plan
Actual burn
Actual performance

Schedule impact

Ratio Calculation

Cost impact

Earned Value Analysis


May
June

July

BCWS
ACWP

$ 120,000.0
$ 119,000.0

$ 192,000.0
$ 187,000.0

$ 192,000.0
$ 165,000.0

$ 192,000.0
$ 189,000.0

$ 192,000.0
$ 186,000.0

BCWP

$ 133,250.0

$ 197,000.0

$ 220,000.0

$ 215,000.0

$ 240,000.0

SV
SPI
CV
CPI

$ 13,250.0
1.11
$ 14,250.0
1.12
May

5,000.0
1.03
$ 10,000.0
1.05
June

$ 28,000.0
1.14
$ 55,000.0
1.33
July

$ 23,000.0
1.12
$ 26,000.0
1.14
August

$ 48,000.0
1.25
$ 54,000.0
1.29
September

August

September

Average

1.13
1.18
Average

Technical Infrastructure

Monthly Plan

Monthly status

Plan
Actual burn

BCWS
ACWP

$ 120,000.0
$ 120,000.0

$ 192,000.0
$ 215,000.0

$ 192,000.0
$ 192,000.0

$ 192,000.0
$ 216,500.0

$ 192,000.0
$ 170,000.0

Actual performance

BCWP

$ 120,000.0

$ 170,000.0

$ 173,000.0

$ 190,000.0

$ 185,000.0

$ (22,000.0)

$ (19,000.0)

0.88
$ (45,000.0)

0.90
$ (19,000.0)

0.99
$ (26,500.0)

0.96
$ 15,000.0

0.94

0.93
Average

Ratio Calculation

Schedule impact

SV

Cost impact

SPI
CV

(7,000.0)

CPI

1
May

0.79
June

0.90
July

0.88
August

1.09
September

Plan
Actual burn

BCWS
ACWP

$ 240,000.0
$ 239,000.0

$ 384,000.0
$ 402,000.0

$ 384,000.0
$ 357,000.0

$ 384,000.0
$ 405,500.0

$ 384,000.0
$ 356,000.0

Actual performance

BCWP

$ 253,250.0

$ 367,000.0

$ 393,000.0

$ 405,000.0

$ 425,000.0

Schedule impact

SV

$ 13,250.0

$ (17,000.0)

$ 21,000.0

$ 41,000.0

SPI
CV

1.06
$ 14,250.0

0.96
$ (35,000.0)

1.02
$ 36,000.0

1.05
$(500.0)

1.11
$ 69,000.0

1.03

Cost impact

CPI

1.06

0.91

1.10

0.99

1.19

1.05

Combined Projects

Monthly Plan

Monthly status

Ratio Calculation

(2,000.0)

9,000.0

Based on the data given in exhibits of the case Earned Value Analysis was conducted as above. Some
of the main points that came out of the exercise can be summed as below.
Software Customization

The scheduled variance (SV) for each of the month is positive which signify that the project is
ahead in this regard

PRIYANSHU KUMAR
ROLL NO 1311314
The Cost variance (CV) for each of the month is again positive which means that the project
is being done in lesser resources than planned
The SPI for each month is greater than 1 which means that more work is being done than
planned
The CPI for each month is also greater than 1 which means the project is producing more
than the spent cost

Technical Infrastructure

SV for technical infrastructure was found to be negative for all months which implies that
the project is behind schedule right from the start
CV for months have been found varying. Initially it was zero, that means project was at par
with the cost, then it became negative showing the cost increased and in the last month it
became positive which means cost efficiency again crept in
SPI and CPI were less than 1 which meant less work was done as planned and project was
spending more for less work done

Some of the problems that the PM team felt during the implementation were

There was no effective communication among project teams as such. One in which a part
time MED-X staffer was repeatedly pulled off the project for other duties. The other one was
when there was delay in getting Sun server equipment.
There were no proper controls and checks as his team uncovered several things that were
not working as designed.
Some of the MED-X resources were allocated as and when needed.

These problems were not communicated well with Terry Baker which can be due to many reasons.
One of the thing can be the higher position held by Terry (CIO) which created a communication gap
between him and Martin. It can also be due to the fact that Martin wanted to maintain status quo
for the project. This being Martins first major project he may not have wanted to share the delays
happening due to various reasons as it will ultimately hamper his credibility to drive down a project
successfully.
Some of the thing that Martin could have done earlier to avoid these delays are discussed below.

Exit barrier for employees part of the project management team


Formalization of channel for knowledge sharing
Involving others in decision making process to keep up the pace of infrastructure projects
Periodic checks for project movement, infrastructure project was lacking right from the start

Future Course of Action


As seen from the calculation done above the Earned Value parameters of the project are still under
control hence the project still can be completed on time. But in order to do that close eye should be
kept on the future doings like rest of the technical infrastructure creation. There may be need for
active management of resources.
Project Management should have timely check and bounds for gauging the progress. Judgemental
biases and misperceptions of feedback can lead to communication gap. A complete mapping of
feedback structure should be there. Also evolving along the way can be a good step to keep pace of
the changing environment. Also active support of the top management is a necessary condition for
project success, as if the project is left in the hands of an outside consultant, some problems may be
created which are not easily solvable by an outsider than an insider.