CPEM cheat sheet

Engineering Management

• Earned Value Management: CV = EV − AC; SV = EV − PV; CPI = EV/AC; SPI = EV/PV. Negative CV or SV means over budget or behind schedule respectively.

• Estimate at Completion variants: EAC = AC + (BAC − EV) when future work proceeds at the planned rate; EAC = BAC/CPI when current cost performance persists; EAC = AC + ETC for a bottom-up re-estimate.

• Variance at Completion: VAC = BAC − EAC. Negative VAC signals a projected overrun at completion; TCPI = (BAC − EV)/(BAC − AC) gives the cost efficiency needed to finish within budget.

• Critical path method: total float = LS − ES = LF − EF. A path with zero total float is critical; reducing duration of a non-critical activity does not shorten the project unless it becomes critical.

• PERT expected duration = (O + 4M + P)/6; standard deviation = (P − O)/6. For a chain, variances add, so path sigma is the square root of summed variances.

• Crashing trades cost for schedule by shortening critical-path activities; fast-tracking overlaps activities that were sequential and raises rework and coordination risk rather than direct cost.

• Resource leveling changes start and finish dates (often extending duration) to resolve over-allocation; resource smoothing uses float only and preserves the original critical-path finish date.

• Risk response categories: avoid, mitigate, transfer, accept for threats; exploit, enhance, share, accept for opportunities. Residual risk remains after a response; secondary risk is created by it.

• Quality cost hierarchy: prevention and appraisal costs are conformance costs; internal and external failure costs are non-conformance. External failure is typically the most expensive category.