Cost, Schedule, and Time Variances and Integration

Abstract

This paper derives and demonstrates detailed schedule- and cost-control relationships at the activity/cost-account level with which project managers can budget, track, and control projects. Time variances are introduced to describe differences between scheduled times and actual times for activity and project performance. Variances are the sum of more detailed variances, and variances can be calculated and reported at different levels of detail, whether for activities and cost accounts or for a project as a whole. Activity/cost-account budgets sum to project budgets and variances sum to project variances. A unified nomenclature and parallel budget and variance structures allow integration of cost and schedule control for projects that share common work breakdown structures. Budget, actual, and variance values of cost, progress, and time are combined in a single illustration to demonstrate integration at the activity/cost-account level. Equation development is augmented with computer implementation details for generic spreadsheets or custom applications. Examples are presented for a single element from start to completion and for a project of four elements.

Author

Robert I. Carr, Ph.D., P.E.
Professor of Civil Engineering
Department of Civil and Environmental Engineering
University of Michigan
Ann Arbor, MI 48109-2125
(734) 764-9420 Fax: 764-4292
Email: RICarr@umich.edu

Keywords

cost control, schedule control, variance, project control, computer applications, construction cost, integration, work breakdown structure, earned value, cost accounting

Availability

1992 by R. I. Carr. Published in the Journal of Construction Engineering and Management, ASCE, June, 1993, pp 245-265.

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