W5_Reginald Nwachukwu_Using SPI and CPI for Performance Measurement on Labor Estimate

1. Problem Definition or Opportunity Statement:

"To measure performance of hourly labor estimate on 1.5km road project using SPI and CPI indicators"

It is required to measure progress and determine SPI & CPI on the planned hourly labor estimate for the construction of 1.56 Km length of road project. 

2. Development of Feasible Alternatives:

The alternatives used to measure progress and performance for the labor estimates includes viz:

(I)  Earned value analysis

(II) Labor Productivity chart

3. Development of Outcome of Each Alternatives:

The outcome considered for development of each alternative is to measure the 'status' of the labor output at any point during the project life cycle. The status of the progress and performance measurement is considered to be measurable. For Earned value, SPI and CPI are used, whereas, for Labor Productivity Chart, Time and duration are measured.

                  Table 3-1 Labor Estimate for 1.56Km Access Road in Omuku, Rivers State

4. Selection of Acceptable Criteria:

The selection of acceptable criteria is used a performance measurement technique/tool that shows progress at any point in time during the life cycle of the project by comparing planned hrs, earned hrs and actual hrs expended on the project.

5. Analysis and Comparison of Outcome from Each Alternative:

     Analysis and comparison of  labor estimate is as shown below:

      Table 5-1 Resource loaded schedule of Labor Estimate and computation of SPI & CPI

        Figure 5-1 S-Curve for Labor Estimate on 1.56 Km Access Road at Omoku, Rivers State

6. Selection of Preferred Alternative:

The Earned value analysis is selected because, its measures both progress and performance and actually compare Planned Hrs, Earned Hrs, and Actual Hrs expended on the project life cycle by using S-Curve. 

7. Performance Reporting and Evaluation of Results:

From the S-Curve, its can be seen that both Earned work hrs and Actual work hrs expended on the project are running over budget - Planned work hrs. This is S-Curve is further used to compute performance indicators - CPI and SPI. 

References:

1. Humphreys G.C. (2011)  Project Management Using Earned Value (2nd Edition) P 32-44 CA Humphreys & Associates Inc.

2. Sullivan W.G., Wicks E.M. & Keolling C.P. (2009) Engineering Economy (14th Edition) Pearson International Edition

3. AACE International (2007)  Skill and Knowledge of Cost Engineering  (5th Edition Revised) Morgantown, W.V West Virginia