Project Monitoring & Control : Forecasting Techniques

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ITSU 2006 [ Lesson 10 ] Copyright © 2018 VIT, All Rights Reserved 1

 Project Monitoring and Control

• Once the project management plan has been implemented,

all activities in it must be monitored carefully and controlled.
• Monitoring and control are aimed primarily at the scope,
schedule, costs, quality, and risk.
– These are most likely areas to go awry without close monitoring and
control.

ITSU 2006 [ Lesson 10 ] Copyright © 2018 VIT, All Rights Reserved 2

 Project Monitoring and Control

• Changes made after the project plan has been executed

can lead to cost overruns. Methods used to monitor the
budget include EVM, TCPI, and performance reviews.

ITSU 2006 [ Lesson 10 ] Copyright © 2018 VIT, All Rights Reserved 3

 Forecasting Technique #1: Estimate at
Completion (EAC)
We know that real world situations do not always go as
planned. There are many circumstances beyond your control
that may alter your expected path and require a change in your
planning.
• As a project manager it will be your responsibility to manage
these changes and evaluate their impact on the project
objectives.
• You will evaluate it with the help of project forecasting tools,
such as the Estimate at Completion (EAC).
• The Estimate at Completion (EAC) gives you the forecasted
value of the project when it is completed. With this data it
can forecast how much you may have to spend to complete
the project. In other words, it is the amount of money that
the project will cost.
ITSU 2006 [ Lesson 10 ] Copyright © 2018 VIT, All Rights Reserved 4
 Forecasting Technique #2: Estimate to
Complete (ETC)
• Estimate to Complete is the second forecasting technique
which is used along with Estimate at Completion. It is the
amount of money needed to complete the remaining work.

ITSU 2006 [ Lesson 10 ] Copyright © 2018 VIT, All Rights Reserved 5

 EAC vs. ETC

• There is a difference between Estimate to Complete and

estimate at completion.
• Estimate at completion is the total cost of the project at the
end. On the other hand, Estimate to Complete is the amount
of money required to complete the remaining work from a
given date.
• Moreover, when the project starts, the EAC is equal to the
ETC. As the project progresses, the ETC starts decreasing,
and at the end of the project it becomes zero.

ITSU 2006 [ Lesson 10 ] Copyright © 2018 VIT, All Rights Reserved 6

 TCPI

• The To Complete Performance Index (TCPI) gives you the

future cost performance index that you must follow for the
remaining work if you want to complete it within the given
budget.
• As per the PMBOK Guide, fifth edition:
• “TCPI is the calculated cost performance index that is
achieved on the remaining work to meet the specified
management goal, such as the BAC or the EAC.”
• Put more simply, the To Complete Performance Index
(TCPI) is the estimate of the future cost performance that
you may need to complete the project within the approved
budget. This budget may be your initial approved budget
(BAC), or a newly calculated budget (EAC).

ITSU 2006 [ Lesson 10 ] Copyright © 2018 VIT, All Rights Reserved 7

 Summary

• The To Complete Performance Index is a forecasting tool

which helps you find the future efficiency of the project
which you have to follow for the remaining work of the
project in order to complete the project within the budget. If
the TCPI is less than one, it is good news for you, while in
the case of performance indexes, the opposite is true; i.e. if
the indexes are greater than one, it is good for the project

ITSU 2006 [ Lesson 10 ] Copyright © 2018 VIT, All Rights Reserved 8