ENGI5003 · Professional Engineering Management
Project Control: EVM, Closure & Reflection
This is the flagship quantitative chapter of ENGI 5003: it covers Earned Value Management — turning the three inputs PV, EV and AC into the four control numbers CV, SV, CPI and SPI — plus schedule modifications, completion forecasts, and the standard ways projects are formally closed and reflected on. Almost every Part-C long-answer question is an EVM table you must build then interpret, so the rule negative variance or index below 1 = bad, reported for both cost and schedule, is the single highest-value thing to lock in before a closed-book exam.
What this chapter covers
- 01The three EVM inputs: PV (budget x scheduled%), EV (budget x actual%), AC (cash paid)
- 02The four metrics: CV = EV-AC, SV = EV-PV, CPI = EV/AC, SPI = EV/PV
- 03Sign & index rules + the four-quadrant cost/schedule verdict
- 04The completion family: BAC, ETC, EAC, VAC and Management Reserve
- 05Schedule modifications & forecasts: EAC two ways, TCPI, SPI time update
- 06Milestone Trend Analysis as a schedule-only check
- 07Larson & Gray's five closure types and the closure tasks
- 08Critical reflection: What/So-what/Now-what and the 4 Rs
EVM snapshot — read CV, SV, CPI and SPI from a task table
- +1Planned Value (budget x scheduled%): PV = 20(1.0) + 15(1.0) + 10(0.8) = 20 + 15 + 8 = $43k.
- +1Earned Value (budget x actual%): EV = 20(1.0) + 15(0.6) + 10(0.4) = 20 + 9 + 4 = $33k.
- +1Actual Cost (cash paid): AC = 22 + 10 + 6 = $38k.
- +1Schedule: SV = EV - PV = 33 - 43 = -$10k; SPI = EV/PV = 33/43 = 0.77 — both say behind schedule (negative, <1).
- +1Cost: CV = EV - AC = 33 - 38 = -$5k; CPI = EV/AC = 33/38 = 0.87 — both say over budget (negative, <1).
- +1Verdict: negative variances and indices below 1 on both axes — the package is behind schedule AND over budget (bottom-left quadrant); recommend a recovery plan and re-baseline review.
Key terms
- Planned Value (PV)
- The budgeted cost of the work scheduled by the audit date — how much value the baseline said you should have produced. PV = task budget x scheduled % complete.
- Earned Value (EV)
- The budgeted cost of the work actually performed, priced at plan. EV = task budget x actual % complete, and an activity's EV can never exceed its own budget (PV).
- Cost Performance Index (CPI)
- CPI = EV / AC, the value earned per dollar spent. CPI > 1 is efficient/under budget; CPI < 1 is wasteful/over budget; the dollar form is CV = EV - AC.
- Schedule Performance Index (SPI)
- SPI = EV / PV, the value earned per dollar of planned work. SPI > 1 is ahead of schedule; SPI < 1 is behind; the dollar form is SV = EV - PV (measured in dollars, not weeks).
- Estimate At Completion (EAC)
- The forecast final cost. EAC_O = BAC - CV assumes remaining work runs to plan (optimistic); EAC_R = BAC / CPI assumes today's cost performance continues (usually more realistic). VAC = BAC - EAC.
- Closure types (Larson & Gray)
- The five standard ways a project ends: Normal (delivered as planned), Premature (deliberately cut short with partial scope), Perpetual (never truly ends from scope creep), Failed (abandoned, cannot meet objectives), Changed-priority (resources pulled by the organisation).
Project Control: EVM, Closure & Reflection FAQ
What is the difference between CV/SV and CPI/SPI in EVM?
The variances are in dollars (a subtraction): CV = EV - AC and SV = EV - PV. The indices are dimensionless ratios: CPI = EV/AC and SPI = EV/PV. Both pairings work the same way — schedule is always EV against PV, cost is always EV against AC — and for either form, negative variance or an index below 1 means trouble.
How do I know if a project is behind schedule or over budget from EVM numbers?
Compute EV first. If SV < 0 or SPI < 1 you are behind schedule; if CV < 0 or CPI < 1 you are over budget. Always report both dimensions: mixed signs are common — behind but under budget often means under-resourced, while ahead but over budget often means you threw money at speed.
Why is SPI measured in dollars when schedule is about time?
EVM values everything at planned cost, so SV/SPI describe the dollar value of the schedule gap, not the number of weeks late. To convert a slip into time you use the schedule index over the critical path: ED(1) = OD / SPI_crit.
Does a Failed or Changed-priority project still get closed properly?
Yes. The closure type only describes how it ends; every type still runs the same closure tasks — finish, hand over, gain acceptance of what exists, document, archive, review and disband. Skipping lessons learnt or the archive on a failed project is a classic mark-losing assumption.
What reflective model should I use for the Project Reflection?
Two standard models are taught: 'What / So what / Now what' (describe, analyse, evaluate) for a quick structure, and the 4 Rs (Report & Respond, Relate, Reason, Reconstruct) for a deeper link to theory and re-planning. Write in the first person — it is an Engineers Australia Stage-1 competency.
Exam move
Treat the EVM table as a mechanical drill you can do half-asleep: lock the three columns (PV = scheduled%, EV = actual%, AC = cash), sum each, then turn the handle on CV/SV and CPI/SPI. Practise re-deriving five different small tables until the four metrics fall out without thinking, because the formula sheet gives you the equations but the marks live in the interpretation — always state both cost AND schedule, and translate the numbers into a verdict and a control action. For the forecast layer, memorise the two EAC routes (BAC-CV optimistic vs BAC/CPI realistic) and which assumption each makes. For close-out, learn the five closure types as distinct definitions (don't confuse Premature with Failed or Perpetual) and the 7 closure tasks as one chain that applies to every type, then have one reflective model (What/So-what/Now-what) ready to deploy.
