5/23/2020 Assignment No.

2
SPM

Arsam Ali FA17-BSE-025

Hamza Tariq FA17-BSE-049
Hamza Zafar FA17-BSE-050
SUBMITTED TO: MAAM ISMA UL HASSAN
BSE-6A
Do the following for the Online Learning Management LMS for COMSATS project.

1. Develop a Work Breakdown Structure using tabular format. It must be

complete up to three levels.

Level 1 Level 2 Level 3

1 Online Portal 1.1 Requirement 1.1.1 Software Requirement Document
Gathering 1.1.2 Specification of Architecture
1.2 Designing 1.2.1 Architecture Design
1.2.2 Wide Framing
1.2.3 Approval
1.2.4 Actual Design
1.3 Development 1.3.1 Online Learning Curriculum
1.3.2 Online Learning Resources
1.3.3 Online Quizzes and Assessments
1.4 Testing 1.4.1 Test Requirement
1.4.2 Test Planning
1.4.3 Test Design
1.4.4 Test White Box
1.4.5 Test Black Box
1.4.6 Test Integration
1.4.7 Test Reports & Acceptance
1.4.8 Sign Off
1.5 Deployment 1.5.1 Beta Version Deployed
1.5.2 Client Approval
1.5.3 Live Deployment
1.5.4 Sign Off

2. Do the financial analysis of the selected project that must include NPV
analysis, Payback analysis and ROI.
A sum of $400,000 investing in this IT project of Comsats may be given a series of flow
$ 70,000 in 1 year
$ 120,000 in 2 year
$ 140,000 in 3 year
$ 140,000 in 4 year
$ 40,000 in 5 year
It is an opportunity cost of capital is 8% per anumm.
To calculate the Net Present Value
Calculate a value of PV(persent value) after a 1 year, 2 year ,3year ,4 year,5 year.
NPV=presnt value of all cash inflow- present value of all cash outflow.
If NP V is +ive the accept project other wise reject it.
Formula
PV=FV *(1/(1+k)^n)
n is number of year
k is cost of capital 0.08
put in formula
 PV $70,000 in 1 = 70000/1.08 64,814.8
year

PV $120,000 in 2 = 120000/(1.08)^2 102880.7

year

PV $140,000 in 3 = 140000/(1.08)^3 111136.5

year

PV $140,000 in 4 = 140000/(1.08)^4 102904.2

year

PV $40,000 in 5 = 40000/(1.08)^5 27223.33

year

Cash inflow of all = 408959.5

pv,s

Cash inflow of all present value is=$408959.5

Present value of cashOutflow=$400,000
NPV =PV of cash inFlow- Pv of cash Outflow
NPV=408959-400000
$ 8959 ANS
Since NPV is postive so project is accepted

Payback period
Example:”
A sum of $25,000 is investioong on the IT project of comsats Online learning system ,
may give a series of cash inflow in future
$ 5,000 in 1 year
$ 9,000 in 2 year
$ 10,000 in 3 year
$ 10,000 in 4 year
$ 3,000 in 5 year
Intial cash outflow=$25,000
Payback period = in between 3 year and 1
 1 5000
2 9000 14000
3 10000 24000

4 10000 34000
5 3000 37000
3.1 year 24833.3

ROI Analysis
A sum of 1000 Dollars is investiiong on a project of comsats
$ 400 in year 1
$ 400 in year 2
$ 400 in year 3
$ 400 in year 4
ROI= 400/1000=40% annual
Payback period = 2.5 year(400+400+50%*400)
PAYBACK=1/ROI

3. Make a network diagram of the activities and determine their schedule.

 Network Diagram:

Activities Predecessor Duration

Requirement 6
elicitation(A)
Project Charter(B) Requirement 2
elicitation(A)
Scope Statement(C) Requirement 2
elicitation(A)
Assign tasks to Project Charter(B) 7
teams(D)
Project Plan Dev(E) Scope Statement(C), 8
Project Charter(B)
User Requirement Project Plan Dev(E), 6
Gathering(F) Scope Statement(C)
LMS Design(G) User Requirement 12
Gathering(F),(D)
Develop LMS in LMS Design(G) 22
stages(H)
Test the LMS(I) Develop LMS in 5
stages(H)
Deploy(J) Test the LMS(I) 1

C H I
2 E
22 5
8
Start
End
F G

6 12 J

1
A B D
Paths Duration
6 2 A,B,D,G,H,I,J 7 55
A,B,E,F,G,H,I,J 62
A,C,E,F,G,H,I,J 62
 A,C,F,G,H,I,J 54

Do the Earned Value Analysis for the following example.

This is a project with two tasks.

After some planning, we get the table below with schedule and budget
Let’s assume it’s March 3rd today and, we are doing the analysis up to the current
point (today)

Planned Value for each activity

Lets say on March 3rd that is today, after discussions with the applicable project
team members and inspection of the progress, we determine that the first task is
20% complete and the second task is 10% complete
 Calculate the Earned Values for each task

Task 100:  EV = 20% x $10,000 = $2,000.

Task 200:  EV = 10% x $15,000 = $1,500.

We will add another column to our table.

ID Name Start End BAC PV EV

10 $10,00
Set up Database Mar. 1 Mar. 10 $3,000 $2,000
0 0

20 $15,00
Build Application Mar. 7 Mar. 20 $0 $1,500
0 0

$25,00
TOTAL $3,000 $3,500
0

After reviewing our time and expense software and compiling any miscellaneous
expenses, we determine that the actual cost of the first task is $4,500 and the
second task is $2,000.

Calculate the Schedule Variance (SV), Cost Variance (CV), Schedule

Performance Index (SPI), Cost Performance Index (CPI), Estimate at
Completion (EAC) and Estimate to Complete (ETC).

Schedule Variance (SV)

 The schedule variance tells you how far ahead or behind schedule the task is in terms of the task
budget.  The formula is:

SV = EV – PV

With the schedule variance, positive is good.

As before, we will add a column to the table for Schedule Variance.

Task 100:  SV = $2,000 – $3,000 = -$1,000.

Task 200:  SV = $1,500 – $0 = $1,500.

ID Name Start End BAC PV EV AC SV

100 Set up Database Mar. 1 Mar. 10 $10,000 $3,000 $2,000 $4,500 -$1,000

200 Build Application Mar. 7 Mar. 20 $15,000 $0 $1,500 $2,000 $1,500

TOTAL $25,000 $3,000 $3,500 $6,500 $500

the project has a positive schedule variance because one task is ahead and the other is behind.

Schedule Performance Index (SPI)

The Schedule Performance Index (SPI) is similar to the Schedule Variance (SV).   It tells you
the efficiency of the task.

The formula is:

SPI = EV / PV

With the SPI, greater than 1.0 is good.

Task 100:  SPI = $2,000 / $3,000 = 0.67.

Task 200:  SPI = $1,500 / $0 = N/A.

ID Name Start End BAC PV EV AC SV SPI

100 Set up Database Mar. 1 Mar. 10 $10,000 $3,000 $2,000 $4,500 -$1,000 0.67

200 Build Application Mar. 7 Mar. 20 $15,000 $0 $1,500 $2,000 $1,500 N/A

TOTAL $25,000 $3,000 $3,500 $6,500 $500 0.67

the first task has accomplished only two thirds of what it should have at this point.  Its efficiency is
two thirds of that which was planned.  But task 200 did not have any planned value at this point,
therefore its SPI is effectively infinity.

Cost Variance (CV)

The Cost Variance (CV) is the amount that the task is over or under its budget.  The formula is:

CV = EV – AC

 If CV is negative, the task is over budget.

 If CV is zero, the task is on budget.
 If CV is positive, the task is under budget.
For example,

 CV = -$1,000 means the project is over budget.

 CV = $0 means the project is right on budget.
 CV = $1,000 means the project is under budget.
In the case of both CV and SV, positive is good.
Task 100:  CV = $2,000 – $4,500 = -$2,500.
Task 200:  CV = $1,500 – $2.000 = -$500.

ID Name Start End BAC PV EV AC SV SPI CV

100 Set up Database Mar. 1 Mar. 10 $10,000 $3,000 $2,000 $4,500 -$1,000 0.67 -$2,500

200 Build Application Mar. 7 Mar. 20 $15,000 $0 $1,500 $2,000 $1,500 N/A -$500

TOTAL $25,000 $3,000 $3,500 $6,500 $500 0.67 -$3,000

The project is $3,000 over budget on a project value of $25,000.  There is clearly a budget problem,
but not a schedule problem.

Cost Performance Index (CPI)

The Cost Performance Index (CPI), like the Cost Variance, is a measure of the cost performance of
the project, but it is a relative instead of an absolute measure.  

 The formula is:

CPI = EV / AC

For example,

In the case of both CPI and SPI, greater than 1.0 is good.

Task 100:  CPI = $2,000 / $4,500 = 0.44.

Task 200:  CPI = $1,500 / $2,000 = 0.75.
TOTAL:  CPI = $3,500 / $6,500 = 0.54.

ID Name Start End BAC PV EV AC SV SPI CV CPI

100 Set up Database Mar. 1 Mar. 10 $10,000 $3,000 $2,000 $4,500 -$1,000 0.67 -$2,500 0.44

200 Build Application Mar. 7 Mar. 20 $15,000 $0 $1,500 $2,000 $1,500 N/A -$,500 0.75

TOTAL $25,000 $3,000 $3,500 $6,500 $500 0.67 -$3,000 0.54

The first task has spent more than twice what it should have at this point because CPI < 0.5.  The
second task is better but has spent one quarter too much.  The project as a whole has spent just
under twice what it was budgeted to at this point (CPI = 0.54).  

Estimate to Complete (ETC)

ETC represents the expected cost required to complete the project.  It measures only
the future budget needed to complete the project, not the entire budget (that’s the EAC, next).  

There are two ways to calculate ETC:

1. Based on past project performance:

ETC = (BAC – EV) / CPI
2. Based on a new estimate
This is called a Management ETC.  This means that a new estimate is created for the
remaining tasks in the project.

Task 100:  ETC = ($10,000 – $2,000) / 0.44 = $18,182.

Task 200:  ETC = ($15,000 – $1,500) / 0.75 = $18,000.

ID Name Start End BAC PV EV AC SV SPI CV CPI ETC

100 Set up Database Mar. 1 Mar. 10 $10,000 $3,000 $2,000 $4,500 -$1,000 0.67 -$2,500 0.44 $18,182

200 Build Application Mar. 7 Mar. 20 $15,000 $0 $1,500 $2,000 $1,500 N/A -$500 0.75 $18,000

TOTAL $25,000 $3,000 $3,500 $6,500 $500 0.67 -$3,000 0.54 $36,182
Estimate at Completion (EAC)

The EAC is the full task or project cost expected at completion (the new project budget).  There are
multiple ways to calculate it based on how you expect the future of the performance of the project to
be:

1. Future performance will be based on the budgeted cost

EAC = AC + (BAC – EV)

2. Future cost performance will be based on past cost performance

EAC = AC + [(BAC – EV) / CPI]

3. Future cost performance will be influenced by past schedule performance

EAC = AC + [(BAC -EV) / (CPI x SPI)]

EAC = AC + [(BAC -EV) / (0.8·CPI x 0.2·SPI)]

4. A new estimate is produced

EAC = AC + ETC

In this example we will predict that the current problems were caused by a one time event that isn’t
likely to repeat itself.  Thus, the EAC will use formula #1.

Task 100:  EAC = AC + (BAC – EV) = $4,500 + ($10,000 – $2,000) = $12,500.

Task 200:  EAC = AC + (BAC – EV) = $2,000 + ($15,000 – $1,500) = $15,500.

The table now looks like this:

ID Name Start End BAC PV EV AC SV SPI CV CPI ETC EAC

100 Set up Database Mar. 1 Mar. 10 $10,000 $3,000 $2,000 $4,500 -$1,000 0.67 -$2,500 0.44 $18,182 $12,500

200 Build Application Mar. 7 Mar. 20 $15,000 $0 $1,500 $2,000 $1,500 N/A -$500 0.75 $18,000 $15,500

TOTAL $25,000 $3,000 $3,500 $6,500 $500 0.67 -$3,000 0.54 $36,182 $28,000
The assumption of a one time cost expenditure near the beginning of the project results in a final
project budget of $28,000 versus the $25,000 original budget.

Calculate the Variance at Completion (VAC) using the following formula

VAC = BAC – EAC
And write your reviews about this project.

Variance at Completion (VAC)

The VAC is a forecast of what the variance, specifically the Cost Variance (CV), will be upon the
completion of the project.  

The formula is:

VAC = BAC – EAC

= Old Budget – New Budget

Task 100:  VAC = $10,000 – $12,500 = -$2,500.

Task 200:  VAC = $15,000 – $15,500 = -$500.

ID Name Start End BAC PV EV AC SV SPI CV CPI ETC EAC VAC

100 Set up Database Mar. 1 Mar. 10 $10,000 $3,000 $2,000 $4,500 -$1,000 0.67 -$2,500 0.44 $18,182 $12,500 -$2,500

200 Build Application Mar. 7 Mar. 20 $15,000 $0 $1,500 $2,000 $1,500 N/A -$500 0.75 $18,000 $15,500 -$500

TOTAL $25,000 $3,000 $3,500 $6,500 $500 0.67 -$3,000 0.54 $36,182 $28,000 -$3,000

Hence, the projected variance is -$3,000, and the project manager could obtain approval for the
expected overrun as early as possible, if necessary.

Reviews:
Calculations concludes that our project will be severely over budgeted
if we stay on the same track with the same results, although it is still very
early to draw solid conclusion, but projections suggest we should make
amends to get the project back on track.