Schedule variance

Schedule variance
See also
Planned value Performance shares Maintenance strategy Normal loss Accounts Receivable Aging Money-weighted rate of return Critical chain method Evaluation criteria Baseline schedule

Schedule variance is the variance between earned value and planned value. It shows the amount of work that has either exceeded planned value or is lower than planned value. Schedule Variance (SV) value is shown in terms of dollars when cost is used and in hours when effort is used. It also indicates how much ahead or behind schedule a project is.

A formula can be used to give variance in terms of cost, which indicates how much cost of work is yet to be completed according to the schedule or how much cost of work has been completed over and above the scheduled cost. Positive variance indicates that a project is ahead of schedule; negative variance indicates that the project is behind schedule. Schedule variance can be calculated using the formula: $schedule\,variance(SV)=earned\,value(EV)-planned\,value(PV)$

Elements of schedule variance

Five main elements can be distinguished:

• Planned result describe the work planned to be accomplished during the reporting period
• Actual result describe the work actually accomplished during the reporting period
• Variance describe the variance
• Root cause identify the root cause of the variance
• Planned response document the planned corrective or preventive action

Schedule variance in terms of cost

In truth, the equation for schedulevariance is not all that useful until it is amended to report the schedule variance as a percentage. Once the schedule variance is know in terms of a percentage (positive or negative decimal value). this percentage can be multiplied by the time since project inception to determine the schedule variance in any until of time (days, weeks, months). The equations for schedule variance percent and schedule variance time are as follows :

• Schedule variance percent(SVP)

Schedule variance percent (SVP) indicates how much ahead or behind schedule a project is in terms of the percent of work completed.A formula will give the variance in terms of a percent which indicates what percent of work has slipped with respect to the planned duration or what percent of work has been completed over and above the planned schedule as of a given day/period.: $schedule\,variance\,percent(SVP)=schedule\,varianc(SV)+planned\,value(PV)$

• Schedule variance time (SVT):

Schedule variance time (SVT) is schedule variance shown in terms of time rather than a dollar value or effort as shown by schedule variance (SV): $schedule\,variance\,time(SVT)=schedule\,variance\,percent(SVP)\cdot actual\,duration$

• Cost variance percent (CVP):

Cost variance percent (CVP) indicates how much a project is over or under budget in terms of percent. A formula can be used to derive the variance of money spent to complete the work as planned:

$cost\,variance\,percent(CVP)={\frac {cost\,variance(CV)}{earned\,value(EV)}}$

References

• Dayal S., (2008),Earned Value Management, J. Ross Publishing, Lauderdale.
• Havranek T.J., (2017), Modern Project Management Techniques for the Environmental Remediation Industry, Routledge, Madison.
• Stackpole C.S., (2013), A Project Manager's Book of Forms, John Wiley & Sons, New Jersey.
• Webb A., (2003), Using Earned Value: A Project Manager's Guide, Gower Publishing, Burlington.

Author: Karolina Urbańczyk