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2.9.1        Analyze Indirect Cost Variances

budgeted and actual indirect costs at the level and frequency needed by
management for effective control, along with the reasons and corrective actions
for significant variances.

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cost expenditure rate forecast, and control are crucial to determine
performance against project cost objectives. EVM requires a monthly indirect
cost analysis, by those assigned responsibility, comparing indirect budgets to
indirect Actual Costs and explaining the cause of significant variance(s).


2.9.2       Summarize Information for Management

‘Summarize Information for Management Report’ records the data elements and
associated variances through the project organisation and/or Integrated Work
Breakdown Structure, or both, in accordance with management needs and any
reporting specified for the project.

The same data for internal
control and management needs to be used for reporting to management. Since the
WBS and the OBS exist as a formal and disciplined framework for Project
Management and provide
a formal structure for the comprehensive roll-up of all data elements, they
become the ideal framework for summarizing data from the Control Account level
to the Management Reporting level. Summarizing performance information assists
senior levels of management to focus on the significant problems that require
their intervention. The top significant variances with corrective actions will
be visible to all levels of management, especially where the cost and schedule
performances are at risk.


project’s internal reports and the reports forwarded to management should, as a
minimum, answer to the following fundamental project control questions:

is the monetary value of the work planned?

is the monetary value of the work earned?

is the actual costs for the work accomplished?


2.9.3       Implement Corrective Action

The Earned Value information is
the basis for corrective
action, it must be taken at the lowest level possible, to prevent problems from
escalating to higher levels in the project/organization and preventing surprises
at the end of the project.

Regular monitoring of Earned
Value performance data (including significant variances), and the
identification and implementation of corrective action will ensure the
achievement of project objectives.

Performance measurement data
should be utilized by all levels of management to promote effective project control
and execution. Because of this, the data produced should be available to
managers on a timely basis and must be of sufficient quality to ensure that
effective integrated Project Management decisions can be made. The project’s
internal reports and the reports forwarded to management will indicate the
overall cost and schedule impacts of such problems on the project.


2.9.4          Develop
Successful Recovery Plans

When developing recovery plans, the
following should be considered:

Review only activities along the
critical path.

Only select activities with
less than 50% earned value progress, activities with more progress may not have
enough unfinished scope left to influence and deliver a successful outcome.

Review Work Packages with long durations
and challenge the relevant CAM to re-engineer with a view to shorten durations.

Design systems differently
(e.g. to shorten site construction time):

o    Do more work off-site, send equipment in a more assembled state to

o    Use a larger crane (do more work at ground level).

o    Increase supervision.

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