BUSI 313 Week 7 Project Section 2 Example

Eastside Clinic Relocation: Week 10 Earned Value Status Report, Recovery Plan and Closure Plan

1. Status Summary

At the end of week 10, the relocation is about one week behind schedule and about 8 percent over budget on the work performed. Renovation, the critical activity, is 75 percent complete instead of the planned 87.5 percent because the contractor found deteriorated subfloor in two exam rooms. All other activities scheduled to date are complete. With the recovery action recommended below, the move date of week 18 can be held, and the forecast cost remains within the authorized budget including contingency.

2. Earned Value at Week 10

Planned value assumes each activity's cost is spent evenly across its scheduled weeks, following the early-start baseline from Section 1.

• Schedule variance: EV minus PV, $106,500 less $121,500, is negative $15,000.
• Cost variance: EV minus AC, $106,500 less $114,800, is negative $8,300.
• Schedule performance index: earned value over planned value, 106,500 over 121,500, gives 0.88.
• Cost performance index: earned value over actual cost, 106,500 over 114,800, gives 0.93.
• Estimate at completion: budget at completion of $266,000 divided by a CPI of 0.93 is about $286,700.

3. Interpretation

Read through Larson and Gray (2018), the two indexes say the clinic has finished only 88 cents of work for every planned dollar and paid a dollar for every 93 cents of work accomplished. Both indexes point to the same activity: renovation. The subfloor repair added labor and materials and slowed progress. The variance is not spread across the project; it sits almost entirely on the one activity the move date depends on. Because renovation is on the critical path, two weeks of work remain on an activity that was due to finish at the end of week 11, so the activity will now finish at the end of week 12, pushing every later critical activity back one week unless something changes.

Research supports acting now rather than waiting. Lipke et al. (2009) showed how statistical methods applied to the performance indexes can forecast final cost and duration with stated confidence, giving a manager an early and defensible warning instead of a hunch. The forecast cost of about $286,700 exceeds the direct budget of $266,000 by roughly $20,700 but remains within the authorized budget of $292,600, leaving about $5,900 of contingency.

4. Recovery Plan

Two options were compared for recovering the lost week.

Option 2 is recommended. Furniture installation is also critical, and it can be shortened at less than half the cost of overtime without asking an already strained renovation crew to work longer days. Under Option 2, installation runs from the end of week 12 to the end of week 15, staff training from 15 to 17 and the move in week 18. Network installation, which had one week of slack, now has none and becomes critical, so the IT vendor has been asked to confirm crew availability for weeks 13 to 15. With the $4,500, forecast cost rises to about $291,200, still within the authorized budget, and contingency would then be nearly exhausted, which the director has been informed of.

5. Closure Plan

• Final acceptance: walkthrough with the clinic director and medical lead in week 18, using the acceptance criteria from the scope statement.
• Contract closeout: confirm the contractor's punch list is complete, release retainage and close purchase orders.
• Release of resources: return borrowed staff to normal duties and close the project budget.
• Documentation: archive drawings, warranties, inspection approvals and the network configuration.
• Lessons-learned review: a facilitated meeting within two weeks of go-live, with findings recorded in the clinic's project file.

6. Making the Review Count

Larson and Gray (2018) treat the project review as a key part of closure, but research shows organizations often fail to use what they learn. Williams (2008) found that while many organizations conduct reviews, few have effective ways to carry the lessons into future projects. The clinic will therefore assign the facilities manager to add one specific item from this review, the need to inspect subfloors before renovation estimates, to the checklist used for future building projects.

References

Larson, E. W., & Gray, C. F. (2018). Project management: The managerial process (7th ed.). McGraw-Hill Education.

Lipke, W., Zwikael, O., Henderson, K., & Anbari, F. (2009). Prediction of project outcome: The application of statistical methods to earned value management and earned schedule performance indexes. International Journal of Project Management, 27(4), 400-407. https://doi.org/10.1016/j.ijproman.2008.02.009

Williams, T. (2008). How do organizations learn lessons from projects, and do they? IEEE Transactions on Engineering Management, 55(2), 248-266. https://doi.org/10.1109/TEM.2007.912920