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1.  Introduction

In previous posts, we have talked about earned value management, forecasting, and the to-complete performance index or TCPI.   These can show the variances in the present, and the variances that will exist by the time the project is finished if the cost and/or schedule performance continue on in the same way that they are now.

The purpose of this post is to talk about performance reviews, which analyzes not only the present and or the future performance of the project, but the PAST performance as well and how it differs from the performance now on the project.

2.  Three types of performance reviews

When someone says “performance reviews”, one naturally thinks of human resource performance reviews, where the individual’s performance on the job is reviewed.   This kind of performance review is different in that it focuses on the performance of the project.

• Variance analysis–cost variance (CV), schedule variance (SV), or variance at completion (VAC)
• Trend analysis–compares past performance and present performance
• Earned value performance–uses other measures from earned value management to analyze performance.

The most important thing to remember is that the analysis asks the following questions:

WHAT is the performance and how does it deviates from what it should be?

IS the trend getting better or worse?

WHAT is the cause of the variance?

It’s like diagnosing the disease of a patient if you’re a doctor.   Okay, you detect symptoms of some sort of illness.   What is the cause of the disease?   Knowing this will lead you to a cure.   Similarly, knowing the cause of the variance will lead you to propose a change, which then becomes the basis for a change request.

The next post will cover the final tool & technique used in process 7.4 Control Costs, Reserve Analysis.   How is monitoring and controlling costs related to looking at risks?   That’s the question the next post will answer.

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1.  Introduction

The last formula to be discussed is that relating to the 3rd technique listed for process 7.4 Control Costs, namely, the To-Complete Performance Index or TCPI.

What does index do for you?   Well, let’s say you are driving downtown and your GPS system tells you it will take 30 minutes to get there.   You notice that traffic is heavier than normal on the way, and 15 minutes into the journey you realize that you have only gotten a quarter of the way.   This means that for some reason you have been going twice as slow as the GPS estimated you would, perhaps because there was an accident on the freeway that caused the traffic to be heavier than predicted.

In any case, you can tell intuitively that, NOW in order to get downtown you would have to speed up, perhaps even greater than the speed limit, in order to make up for the slow performance in the first half of your trip.   This is analogous to what the TCPI does.  

If your CPI is less than 1.0, the TCPI can tell you what your CPI needs to be from here on out in order for you to either a) meet the cost baseline or b) to meet the estimate at completion.

Here is the first formula:

a.  TCPI = (BAC – EV)/(BAC – AC)

What does it mean?   The BAC – EV is the remaining work that needs to be done on the project.   BAC – EV is the remaining budget or funds with which that work must be done.   The resulting TCPI is the efficiency that must be maintained throughout the rest of the project in order for you to complete the project according to the plan.

b.  TCPI = (BAC – EV)/(EAC – AC)

In this formula, BAC – EV is the remaining work that needs to be done on the project, just as in the other formula.  In this case, however, BAC – AC is replaced with EAC – AC, and this is the remaining budget estimate or estimated funds with which that work must be done.   The resulting TCPI is the efficiency that must be maintained throughout the rest of the project in order for you to complete the project according to the EAC or estimate at completion.

Although I have not seen this formula on any PMP test questions, it is a good idea to at least understand conceptually what the formula is for and what its component terms are.

Tomorrow I will discuss some of the remaining tools & techniques for process 7.4 Control Costs.

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1.  Introduction

In the previous posts, I covered the basic formulas having to do with the three quantities of Planned Value (PV), Earned Value (EV), and Actual Cost (AC), and Budget at Completion (BAC).  Then I covered the variances Cost Variance (CV), Schedule Variance (SV), and Variance at Completion (VAC), as well as the performance indexes, Cost Performance Index (CPI) and Schedule Performance Index (SPI).

In this post, I discuss the estimate to completion or EAC used in the technique of Forecasting. The formulas tell “will be finish the project on time and within the budget?”   To calculate these quantities, we need to introduce some new terms.

2.  Terms dealing with the project cost at completion

3.  Relationship between PV, AC and the terms of completion (BAC, EAC, ETC, VAC)

So two of the formulas that relate to the terms of completion, namely,

can be memorized simply by realizing what the terms actually mean.

4.  Calculating the EAC

So how to you calculate the EAC?   As listed in the chart in paragraph 2, there are several formulas, which is always a point of confusion for test takers.  How do you know which one to use?  Here are the formulas, their characteristics, and an explanation of when they are to be used.

The purpose of each formula for EAC is to estimate how much it will take to complete the project based on the performance to date.   If the project is over budget or behind schedule, the key in figuring out the EAC is to analyze WHY it is over budget or behind schedule.  This will give you the clue as to which formula to use.   I’ll give some examples after explaining the terms in the table.

Formula 1.  If the original budget is considered totally flawed, then one way to estimate the amount it will now take to do the project is to take the amount spent on the project so far (AC) and then do a more accurate bottom-up estimate of the amount it will take to complete the project (ETC).  That’s one way to do it.  But if you are answering a question from the PMP exam, don’t use this formula unless it specifically states the ETC is a brand-new estimate.   In this case, they will have to give you the figure for ETC because it is not derivable from any other formula but from the project’s own WBS (work-breakdown structure).

Formulas 2-4.  The rest of the formulas are similar in that they all start with AC, the actual cost up to now, and then they add an amount called the remaining work or BAC – EV, modified by some other factor.

The assumption is made that the EV is somehow different than the PV, i.e., the project is off schedule somehow.   Now the PV is essentially useless for planning purposes because it shows you the value of the work that was supposed to be done, and the assumption is that the EV is somehow different than that.   So the logical think to do is to start figuring out how much work actually needs to be completed from now (EV) to the end of the project (EAC), and that difference BAC – EV is the remaining work.

 In formula 2, that difference is simply added to the actual costs already incurred, because the remaining work will be done on time and on schedule, the one-time variance having already occurred.  In formula 3, the remaining work is divided by the cost performance index, because this formula assumes that the remaining work will be done at the same cost performance index (i.e., cause of variance is ongoing).  In formula 4, the remaining work is divided by both the cost performance index and the schedule performance index, if BOTH of these performance indexes will persist throughout the rest of the project.

The next post will deal with the next technique, the to-complete performance index, which tells you if you are behind schedule now, how much “pedal to the metal” you have to apply to get to the end of the project on schedule.

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This is a summary of the seventh part of twenty-four in the course on the New Testament presented by The Teaching Company.  The lectures in this course are by Prof. Bart D. Ehrman, the James A. Gray Distinguished Professor of Religious Studies at the University of North Carolina at Chapel Hill.  His expertise is in the Greco-Roman cultural environment of early Christianity and the textual criticism of the New Testament.  For those who are interested in purchasing this course and listening to the complete lectures, please go to http://www.thegreatcourses.com.

7.  Jesus the prophesied Messiah

The stress that Luke places in his genealogy on Jesus being the Savior of the entire human race can be found throughout Luke’s Gospel at a number of critical junctures.  That can be seen above all by comparing several episodes of Luke with those that are found in Mark, which was one of Luke’s sources.  One of the most interesting stories to compare with Luke and Mark has to do with an event that takes place halfway through Mark’s Gospel in which Jesus goes to his hometown of Nazareth and preaches in the synagogue only to be rejected by his townsfolk who can’t understand how a simple carpenter like Jesus can speak such words of wisdom (Mark 6:1-6).  Luke also has this account (Luke 4:16-30), but he has changed it in significant ways.  The first thing to notice is that in Luke’s Gospel, this rejection of Jesus is the very first thing that happens in Jesus’ ministry.  It doesn’t happen as halfway through the account in Luke, but it’s the first that happens.

Why does Luke transpose the account to the very beginning?  Because in Luke’s Gospel, this is going to set the stage for everything else that is to come.  Moreover, in Luke’s account, the rejection of Jesus of Nazareth is much longer than in Mark.  Luke lengthens the account by having Jesus read from the prophet Isaiah in the synagogue.  Jesus goes to the synagogue and gets up to read the scriptures.  The attendant hands him a scroll of Isaiah, Jesus reads the scroll and it’s a passage which says “the spirit of the Lord is upon me because he has anointed me to preach to the poor; he has sent me to proclaim forgiveness to the captives, sight to the blind,” etc.  And then Jesus sits down—this is found only in Luke, not in Mark—as everybody is looking at him and says “truly today this scripture has been fulfilled in your hearing.”  Jesus explicitly claims to fulfill the prophet Isaiah.  He is the prophet that Isaiah has anticipated.  The people wonder what Jesus can possibly be talking about, and Jesus likens himself to two prophets of the Hebrew Bible:  Elijah and Elisha, whose stories in the Hebrew Bible include accounts of them going out to help people who were non-Jews even when Jews were suffering.

There’s a drought in the land in and Elijah, rather than going to stay and help out a Jewish family, goes to a pagan family, a widow in Zarephath (1 Kings 17:7-16).  Elisha is sent to heal a leper; not a Jewish leper, but a pagan leper.  Jesus likens himself to Elijah and Elisha and his audience knows full well what he is talking about.   He is saying that he has come to minister not to Jews but to Gentiles.  Their reaction is immediate.  They take him out of the synagogue, they take him up to a high hill, and they going to try to cast him off, but Jesus then walks through their midst.

It’s an interesting account because it’s going to set the stage for what’s going to happen in Luke’s Gospel and then in the Book of Acts.  Jesus comes to his people, he proclaims his message of salvation that he is the one that fulfills the prophets.  They reject him, and because they reject him, his message goes to the Gentiles.  Jesus throughout this account is portrayed as a rejected Jewish prophet.  There are several ways in which Luke portrays Jesus as a prophet in narratives that are unique to Luke.

8.  Jesus as Prophet

First, Jesus is born like a prophet.  Like Matthew, Luke has a birth narrative.  We saw that Matthew’s narrative emphasized that Jesus is like Moses and that Jesus fulfilled scripture.  Luke also has an account of Jesus being born to a virgin, Mary, in Bethlehem, but here the emphasis is quite different.  What one sees when one reads this account is not that Jesus is fulfilling scripture in the sense that you have in Matthew.  Instead you have a sense that Jesus is born how prophets are born, specifically, when Mary conceives Jesus, she breaks out into a song in which she praises God for bringing down the high and raising up those who are low.  It’s a song that sounds almost exactly like the song of Hannah in the Hebrew Bible 1 Samuel chapter 2, Hannah who gave birth to the first major Jewish prophet Samuel.  Mary’s song in other words is to call to mind the song of Hannah.  Why?  Because Luke is trying to emphasize that Jesus is born how prophets are born.

Second, he’s not only born like a prophet, he preaches like a prophet, as we saw in the sermon he gave at Nazareth.  He claims that the prophecies have been fulfilled in him and he likens himself to Elijah and Elisha, these two great prophets of the Hebrew Bible.  All of these stories are found in Luke; you don’t find them in Matthew and in Mark.

Thirdly, Jesus heals like a prophet heals.  There’s a very interesting account in Luke 7:11-17 of Jesus raising from the dead the dead son of a widow from a city called Nain.  The account, if you know the Hebrew Bible well enough, sounds very similar to the account of Elijah raising the dead son of widow from a city called Zarephath (1 Kings 17:8-9).  In fact, the similarity of the miracle is not lost among the people who witness it in Luke’s Gospel.  In chapters 7 through 16, the crowd acknowledges the significance of what Jesus has done on the occasion by saying “a great prophet has risen among us.”

So Jesus is born like a prophet, he preaches like a prophet, he heals like a prophet, and most significantly, he dies like a prophet in Luke’s Gospel.

9.  The Passion Narrative in Luke

Jesus explicitly says only in Luke that he must go to Jerusalem to be killed because that’s where the prophets die (Luke 13:33).  Because Jesus is being portrayed like a prophet in his death, Luke modifies some of the traditions about the Passion narrative itself in some very interesting ways.  Jesus knows what’s going to happen to him in Luke’s Gospel.  Because he knows, it doesn’t appear that Jesus experiences real agony in this Gospel the way he does in the others.  This is one place in particular where it’s important not to conflate the accounts and pretend they are all saying the same thing.  If you read Luke’s account just on its own terms, you don’t have the sense of Jesus going through real agony up to his death.

You can see this in two different narratives.  When Jesus goes out to pray prior to his arrest, in Mark’s Gospel, Jesus goes to the garden of Gethsemane.  He’s extremely distraught; he tells his disciples that his soul is troubled unto death.  He tells them to wait for him.  He goes off, he falls on his face, he prays three times, “God, take away this cup from me.”  Luke has the same narrative, but Luke doesn’t say that Jesus is distraught.  Jesus in this narrative doesn’t say to his disciples, “my soul is troubled unto death.”  He goes to pray, but he doesn’t fall on his face; instead he kneels down.  Instead of praying three times “God, take away this cup from me,” he says “if it be your Will, take this cup from me,” and he says it only once.  There’s not the same sense of agony here at all.

The idea of Jesus not being in real distress and agony going up to his death is seen even more clearly in the account of Jesus’ own crucifixion in Luke’s Gospel.  Again, it’s worthwhile comparing what Luke says with what his predecessor Mark had said.  Remember Mark’s account:  Jesus appears before Pontius Pilate, he is accused of being King of the Jews; he is basically silent during the whole proceeding.  He only says a few words in Mark’s Gospel.  Pontius Pilate asks him, “are you the King of the Jews?”, and Jesus says “you say so.”  He goes to his place of crucifixion and he is silent the entire way in Mark’s Gospel.  He is nailed to the cross in Mark’s Gospel and is silent the whole time.  People are passing by, people are mocking him, and he says nothing even on the cross until the very end.  When people have betrayed him, denied him, mocked him, in Mark’s Gospel at the very end he is hanging on the cross and he cries out, “”Eloi Eloi lama sabachthani?”, “My God, my God, why have you forsaken me?”, and he dies.  In Mark’s Gospel, Jesus appears to be in doubt and wonders why God himself has forsaken him in the end.

It’s a stark contrast with Luke, because Luke has changed the story.  In Luke’s Gospel, Jesus is not silent on his way to crucifixion.  He is walking to the cross, and he sees some women weeping on the side of the road and he turns to them and he says weep not for me but weep for yourselves and for your children for what is to befall you.  He has more concern about this women than for himself.  In Luke’s Gospel, while he is being nailed to the cross, he’s not silent:  instead he prays, “Father forgive them; they don’t know what they are doing.”  While he is hanging on the cross in Luke’s Gospel, he’s not silent:  he has an intelligent conversation with one of the other people being crucified with him.  Now in Mark’s Gospel, both robbers mock Jesus; in Luke’s Gospel only one of them mocks him.  The other one tells him to be quiet because Jesus hasn’t done anything to deserve this, and then this robber turns to Jesus and says, “Lord, remember me when you come into your Kingdom.”  And Jesus replies, “Truly, I tell you that today you will be with me in paradise.”

Most striking of all, at the end in Luke’s Gospel, instead of crying out “My God, my God, why have you forsaken me?”, Jesus instead says “Father, into your hands I commend my Spirit”, and then he dies.

There is a tendency for readers to assume that he said all of these things on the cross.  So you have the seven dying words of Jesus, where he says the words in Mark, those in Matthew, those in Luke, and those in John, and altogether you have seven sayings of Jesus.  In fact, these are distinctive portrayals.  Luke is not portraying Jesus the same way Mark is, as someone who is in agony and uncertainty at the end.  In Luke’s Gospel, Jesus is going to his death knowing full well what is happening to him and why it is happening, and what is going to happen to him after his death:  he’s going to wake up that day in Paradise and this robber is going to be with him.

10.  God’s Plan

Jesus is a prophet who is fully certain about God’s Will for him and the future of the Earth.  For that reason, Jesus doesn’t go to his death in agony.  So, Jesus is portrayed as a prophet in Luke, one who is born as a prophet, one who preaches as a prophet, one who heals as a prophet, and one who dies as a prophet.  This emphasis on Jesus as a prophet, one who knows full well what God’s will is, and who is sent to proclaim it, coincides with other emphases found throughout Luke’s Gospel.  In particular, it coincides with an emphasis found distinctively in Luke that everything is going to God’s plan.  The Will of God, the Plan of God, are terms that one finds throughout Luke’s Gospel.

Moreover, in this Gospel there is no emphasis the way there is Mark that the end of the world is supposed to happen right away.  Mark’s Gospel on a couple of occasions that we will refer to later on in the course refers to the stance that the end is immediate.  Jesus tells his disciples in Mark, “some of you standing here won’t taste death before the Kingdom of God has come in power.”  Luke changes that verse to “some of you standing here won’t taste death before you see the Kingdom of God,” but he says nothing about it coming in power.  Luke does think that the disciples have seen the Kingdom of God, because according to Luke Jesus’ own ministry is the Kingdom of God.  Luke says in chapter 17 that “the Kingdom of God is in your midst” or “among you”.  For Luke, there is not going to be an end of the age as we would normally think of; the Kingdom has already arrived in some sense.

So too in the trial before the High Priest, in Mark’s Gospel, Jesus says “you will see the son of Man coming on the clouds of Heaven.”  Luke has the same verse, but he changes it to “from now on, the son of Man will be seated at the right hand of power.”  It’s not that the high priest is going to see the cosmic judge come from heaven; it’s that from now on Jesus will be exalted.

Jesus as a prophet in Luke knows that the end is not going to come right away.  The reason why it’s not going to come right away is because God wanted to allow time for the message of Jesus to go out in the world so that salvation can come to the Gentiles as well as to the Jews.  That’s what the second volume of Luke’s, the Book of Acts, is going to be about, the salvation of God that goes to Gentiles.  Well, it takes time for salvation to go around the world, so of course in this Gospel you can’t expect the end to come right away:  first there has to be time for the establishment of the Church.

Since Luke thinks that there is going to be a long period of time before the coming of the end, Luke more than the other Gospels has a strong social agenda.  Unlike the other Gospels, Jesus stresses the importance of taking care of the needs of those who are poor and oppressed and outcast.  You can some of this in the other Gospels, but in Luke, it is much more strongly stated.

11.  The Beatitudes and Rights of Women

Compare the Beatitudes in Matthew and in Luke.  In Matthew, Jesus says “blessed are the poor in spirit.”  In Luke he says “blessed are you who are poor”; in other words, poverty itself is the problem.  In Matthew, it says “blessed are those of you who hunger and thirst for righteousness.”  In Luke, it’s “blessed are you who hunger and thirst.”  In other words, in Luke’s Gospel, rather than being concerned just about spiritual matters, Jesus is concerned about material matters as well, including the needs and rights of women.

In Luke’s there is an emphasis on the need for Christian communities, the followers of Jesus, to take care of the needs of women who were of course an oppressed group in ancient societies.

12.  Conclusion

In conclusion, Luke is both like and unlike Matthew and Mark, the two other Synoptic Gospels.  Like both of the others, Luke describes Jesus’ public ministry as one this is filled with stupendous,  miraculous fears and marvelous teachings.  Here too, we see the importance of Jesus’ death for God’s plan of salvation.  But instead of stressing Jesus as the misunderstood son of God, as in Mark, or as the Jewish Messiah who insists that his followers keep the Jewish Law, as in Matthew, Luke portrays Jesus as a Jewish prophet whose salvation goes to the whole world to bring salvation not just to Jews, but also to Gentiles, in fulfillment of the plan of God.

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This is a summary of the seventh part of twenty-four in the course on the New Testament presented by The Teaching Company.  The lectures in this course are by Prof. Bart D. Ehrman, the James A. Gray Distinguished Professor of Religious Studies at the University of North Carolina at Chapel Hill.  His expertise is in the Greco-Roman cultural environment of early Christianity and the textual criticism of the New Testament.  For those who are interested in purchasing this course and listening to the complete lectures, please go to http://www.thegreatcourses.com.

1.  Introduction

We have not yet begun to ask the question about what Jesus himself really said and did.  Instead, we have been looking at the distinctive portrayals of Jesus in each one of the Gospels.  We have seen that Mark portrays Jesus as the son of God who, contrary to widely held expectations, must suffer for the sins of the world.  Matthew agrees with this perspective, but adds a strong emphasis that Jesus was the Jewish Messiah sent in fulfillment of the Jewish scriptures, a new Moses who expected his followers to keep the Jewish Law.

Prof. Ehrman turns now to the third of the Synoptic Gospels, the Gospel of Luke, who like Matthew and Mark has a distinctive emphasis of his own.  On the other hand, like Mark, Luke will portray Jesus as the son of God whose death fulfilled the Scriptures, but he does not stress the failure of everyone to recognize Jesus the way that Mark did.  In fact, in Luke’s Gospel, Jesus is worshipped already as an infant.  Like Matthew, Luke will remain that Jesus is the Messiah, but he does not stress that Jesus is the new Moses who demanded that his followers adhere to the Jewish law.  Instead, Luke stresses that Jesus’ salvation comes not just to the Jews, but to all people.

Prof. Ehrman does not mean to say that Jesus is not portrayed as Jewish in the Gospel of Luke, for in fact he is portrayed as a Jewish prophet, that is, a man who knows God’s will and has been called by God to proclaim this will to his people.  Jesus in this Gospel is portrayed as a Jewish prophet sent to the Jewish people who was rejected by them.  Because he was rejected by the Jews, his message of salvation can then go to the non-Jews, that is, to the Gentiles.  That is the overriding thesis of the Gospel of Luke.

2.  Background Information

As with the other Gospels we have considered, this one too is anonymous; the other didn’t tell us his name.  Traditionally the Gospel has been ascribed to a man named Luke who is a Gentile physician who was a traveling companion of the Apostle Paul.  This tradition goes back to the 2^nd century.  Whether or not we can trust the tradition is a matter of debate among competent scholars.  Like the other Gospels, this one was written in Greek.  Apparently, it was written at about the same time as the Gospel of Matthew, possibly around 80-85 AD.

There’s little to suggest that Matthew and Luke knew of each other’s work, but they do both appear to have had access to the Gospel of Mark, and to the lost source of Jesus’ sayings that scholars have called “Q”.  One of the things that makes the Gospel of Luke distinct is that this author wrote a second volume, the Book of Acts, which we will be discussing later in this series of lectures.  The Book of Acts, which is our only surviving account of the history of earliest Christianity after the death of Jesus up through the ministry of the apostle Paul.  In this later lecture, we’ll look at how this second volume, the Book of Acts, continues many of the themes and emphases of this first volume, the Gospel of Luke.  This lecture focuses exclusively on the Gospel of Luke.

3.  The Preface to Luke’s Gospel

One way of approaching Luke’s account is by comparing it with the narratives that we have already considered, those of Matthew and Mark.  Prof. Ehrman wants to compare these accounts not to conflate them, but precisely to show how they differ from one another, so we can see what the distinctive emphases are.

The first thing that strikes one when making a comparison between Luke and the other Gospels is that he begins in a completely different way from Matthew and Mark.  Luke begins by a kind of preface, an overview of his account.  It is a preface that is very much like that of  prefaces of other works that you find from ancient historians.  Luke begins by saying (Luke 1:1-4):  “whereas many have undertaken a narrative of the matters that have been fulfilled among us, just as they were handed on to us from the beginning from eyewitnesses and ministers of the Word, it seemed good to me, most excellent Theophilus, to produce an accurate account, having followed all things carefully so that you might know the certainty of the matters that had been fulfilled among us.”

It’s a very interesting preface for several reasons.  First, as mentioned before, this preface is like prefaces found in other works of other historians, which might suggest that Luke was taking the historical nature of his narrative a little more seriously than the other Gospel writers that we have.  He is trying to mimic the style of ancient historians.

Second, he tells us what his sources of information were.  This was a typical move among ancient historians.  His narrative will be based on accounts that he has seen based on written reports that others have made, and these written reports go back to the reports of eyewitnesses.  In other words, Luke has before him written Gospels and oral traditions.

4.  Luke’s implicit criticism of Mark

Third, it is striking that Luke does not think favorably of his predecessors.  He indicates that others have tried to write an account, but now he wants to write one that’s accurate so that the recipient will know the certainty of what happened before.  In other words, he is casting some slight aspersions perhaps on some of his predecessors, which is particularly interesting if in fact Mark was one of those predecessors, because that might suggest that Luke didn’t think Mark had done an adequate job.  Of course that’s implied by the fact that he has changed Mark so significantly.  If he had liked Mark the way it was, he would have simply copied Mark and published it as is.

5.  Luke’s Dedication

He dedicates this book to Theophilus, but we don’t’ know who Theophilus was.  It’s typical for historians to dedicate their work to a patron, someone who provides financial support for the author.  The author may have been a patron of Luke.  Some scholars have thought that Theophilus might have been some kind of Roman administrator who Luke is giving his book to.  The reason for thinking that is because he calls Theophilus “most excellent Theophilus” and that term “most excellent” is used in the Book of Acts for Roman administrators.  So possibly this is a pagan Roman who Luke is writing for.

While that is a possibility, and a number of scholars think that is what is going on here, it seems to other scholars somewhat unlikely that a book of this size is being handed over to some pagan Roman official as if he would have time or the desire to read it.  There’s another explanation of what “Theophilus” is.  The term “Theophilus” in fact comes from two Greek words meaning “beloved of God” or “lover of God.”  It’s possible that in fact Luke has devised a fictional recipient of this book, one who is loved of God.  In other words, he is writing for Christians in his own community who are loved of God or who are lovers of God.  That makes somewhat better sense since most of these early Christian writings, in fact, all of these Gospels, were probably directed to the Christians rather than to outsiders, say, as missionary literature.  And so it may be that Theophilus is simply a “code name” for the Christians who are receiving this book.

6.  Luke’s Genealogy of Jesus

Once we get beyond the preface, we can see other differences between Luke and the other Gospels.  First, let me point out a striking difference between the Gospel of Luke and the Gospel of Matthew.  It’s not that Luke used Matthew as a source, but they do have some similarities and so it is interesting to look at some of their differences.  One of the striking differences between Luke and Matthew has to do with the genealogy of Jesus that he uses in his Gospel.  Mark doesn’t have a genealogy; Matthew has one and it turns out Luke has one as well.  What is striking is that Luke’s genealogy is different from Matthew’s.

The genealogy that Luke gives is found in Chapter 3.  In Chapter 3 we are told that Jesus was supposedly the son of Joseph who was the son of Heli who was the son of Matthat who was the son of Levi, etc. and it keeps on going back.  Matthew’s genealogy, if you recall, traced Jesus back to King David, and from King David back to Abraham, the father of the Jews.  The stress in Matthew’s genealogy was that Jesus was Jewish, descended from the father of the Jews and the great King of the Jews, and is the Messiah from the Davidic line.

Interestingly, Luke doesn’t just go back to David and Abraham; he goes all the way back to Adam.  This is a terrific genealogy that traces Jesus all the way back to Adam, as in Adam and Eve.  But why?  If Matthew’s genealogy was meant to show the Jewishness of Jesus because he’s related to David and Abraham, Luke’s genealogy is designed to show Jesus’ humanity.  He is not just the Savior of the Jews.  He descends from the entire human race; he’s the Savior of all humankind.

This genealogy is different from Matthew’s not simply because it goes all the way back to Adam.  If you read the beginning part of this genealogy, you realize in fact that it is a completely different genealogy from the one in Matthew.  It traces Jesus’ lineage through Joseph, as does Matthew’s, but Joseph in Luke’s genealogy as a different father and a different grandfather and a different great-grandfather than does Joseph in Matthew’s genealogy.  The names are in fact all different from Joseph back to David.  Some people have tried to reconcile this by saying that Matthew is giving the genealogy of Joseph, whereas Luke is giving the genealogy of Mary.  This would be a clever solution which would explain why you have the different names.  Unfortunately for that thesis, when you read the text itself it is quite clear that Luke’s genealogy is also the genealogy of Joseph.

Apparently Matthew and Luke simply inherited their genealogies from different sources.

The next post will cover the second part of the lecture.

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The most powerful of the tool & techniques of process 7.4 Control Costs is Earned Value Management or EVM. The whole point of earned value management is to find out how the project is performing as compared to the cost and schedule performance baselines. The last post discussed the quantities PV, EV, AC, which are the “building blocks” of the all the EVM variance formulas that I am going to discuss in this post.

1. Variances

A measure of how a project is doing is a variance, which is calculated by taking the earned value (EV) and subtracting either the actual cost (AC) or the planned value (PV).

Here are the variances that are used to measure the performance of a project, together with their definition and the formula of how they are calculated.

With all of these variances, if the result is positive, then that is good: the project is either under budget or ahead of schedule. If the result is negative, then that is bad: the project is either over budget or behind schedule.

2. Performance Indexes

Another measure of how a project is doing is a performance index, which is calculated by taking the earned value (EV) and dividing by either the actual (AC) or the planned value (PV). Here are the performance indexes that are used to measure the performance of a project, together with their definition and the formula of how they are calculated.

With all of these variances, if the result is greater than one, then that is good: the project is either under budget or ahead of schedule. If the result is less than one, then that is bad: the project is either over budget or behind schedule.

These variances or performance indexes are used to find out whether the project is performing better or worse than expected.

The next posts on this topic will show how they can be used to forecast the amount of money it will take to complete the project, as well as the amount of time it will take to complete it.

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1. Introduction

Earned Value Management is the first technique listed in the 5^th Edition PMBOK® Guide for the only time management knowledge area process in the Monitoring & Controlling Process Group, 7.4 Control Costs. It is also the most powerful in the extent of its use and implications for the proper management of a project. For those of you who are new to the concept, and are wondering “what is earned value management good for?”, let me tell you a story. There once was a young Native American brave who once asked his father, “I know that we’ve from the Halawi tribe, but where did the name come from.” “The chief came up that name. Last winter, when we moving our hunting grounds to this place, I went up to him and asked him the same question you asked me. What’s the name of our tribe? He was standing on a hill looking lost, when he looked up from his map, and said, “where the Halawi?” And that’s how we got our name. The purpose of that little story is to let you know that when you are working on a new project, at some point your “chief” or boss may come to ask you the same question, “where the hell are we?” In other words, is the project under budget and on schedule? That’s what earned value management can tell you.

2. Three Key Quantities: PV, EV, AC

There are three basic quantities you need to know when dealing with earned value analysis: Planned value, earned value, and actual cost. The PMBOK® Guide gives a definition which, although accurate, might be more simply expressed as I have attempted to do in the column marked “English Definition” next to the “PMBOK® Guide Definition.” The reason why earned value measurement works is because the quantity of “earned value” is a measure of both the schedule (“measure of work performed”) and the budget (“expressed in terms of budget authorized for that work”), and a combination of earned value and the planned value or actual cost can give an indication of how the project is doing with respect to the schedule or the budget, respectively.

Now the planned value, earned value, and actual cost are measured at various times during the project and thus provide a “snapshot” of how the project is doing.

3. Budget at Completion

One additional quantity you need to be aware that is related to one of the key three quantities above is that of the Budget at Completion. The planned value or PV is the authorized budget assigned to the work scheduled up to that point. If you take the project all the way to its completion, then what should the planned value be at the end of the project? It should be equal to the budget at completion or BAC, in other words, the authorized budget assigned to ALL the work scheduled in the project. However, a word of caution! The actual PMBOK® Guide definition is “sum of all budgets established for the work to be performed”, and then in the chart on page 224 of the Guide, it says in the next column “the value of total planned work, the project cost baseline.” One of the problems about dealing with the project budget is that in reality, it is like a three layer cake, with the bottom layer being the project cost estimate, with a layer of contingency reserves or “filling” on top, which creates the middle layer called the project cost baseline, and a layer of management reserves or “filling” on top of that, which creates the top layer called the project budget. The BAC or budget at completion is, somewhat confusingly, NOT based on the project budget or the top layer, but on the middle layer of the project cost baseline, which includes both the cost estimates and the contingency reserves (but NOT the management reserves). So just be aware that although it says the budget at completion, this will be obtained by getting the project cost baseline for the project, and not the project budget. I guess we could all start calling it the “Baseline at Completion” to avoid confusion, but the terminology of Budget at Completion is so well firmly established, that it would be hard to change the term at this point. The next post shows how these four quantities, PV, EV, AC, and BAC (which is related to PV), can be used to show the variance of the project from its performance baseline of either the schedule or the budget. The fact that it can be used to handle both types of variance is part of the reason why earned value management has such tremendous utility as a technique for monitoring & controlling a project.

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1. Introduction

The three of the four processes devoted to cost management are in the Planning Process Group. The fourth process, 7.4 Control Costs, is in the Monitoring & Controlling Process Group. The performance baseline for costs, the cost baseline, which was determined in the last process, 7.3 Determine Budget, is what the performance of the project will be measured against when the actual costs of doing the work are calculated.

The purpose of this post is to give a general overview of the inputs, tools & techniques, and outputs of this process.

2. Inputs

The main inputs come from the cost management knowledge area, as you would expect. For those projects which are not totally funded in advance of the project, but at various stages during the project, project funding requirements will need to be paid attention to so that the project doesn’t get too far ahead of itself to the point that funding is temporarily not available for activities.

Work performance data is used which will be analyzed and processed into work performance information through this process. The ubiquitous OPAs inputs are also important as they give access to the company’s corporate knowledge base when it comes to cost control.

3. Tools & Techniques

The subject of earned value management, forecasting, the TCPI (To-Complete Performance Index), and performance reviews are the main techniques, with the project management software being the main tool. Earned value management takes a snapshot of the present moment to see how the project is doing. The techniques of forecasting and TCPI shows how the future of the project will evolve given how the project is doing now.

Finally, the performance reviews compare the past performance with the present performance to see how the progress of the project has evolved up until the present moment.

Reserve analysis takes into account the “extra layers” on top of the cost estimates, the contingency reserves (which are added to the cost estimates to get the cost baseline) and the management reserves (which are added to the cost baseline to get the project budget). It should be decided whether any unused reserves will simply be left in the project budget, thereby improving the performance of the project, or whether they will be taken out of the project budget to possibly be used on other projects.

4. Outputs

The work performance information and the cost forecasts are elements which need to be communicated to the project team and concerned stakeholders on a regular basis. If the analysis of these indicate that there is a variance in either the cost or schedule performance of the project that needs correcting, then a change request may be recommended.

The corrective action aims to reduce the variance, whereas preventive action aims to prevent the variance from growing larger in the future. It may happen, however, that the variance is so large that the cost baseline is determined to be unrealistic, in which case it may be suggested that the cost baseline itself is changed.

In any case, these change requests are outputs of this process, but then are inputs to the process in the Integration Management Knowledge area called process 4.5, Perform Integrated Change Control.

As usual with monitoring and controlling processes, the management plans, project documents, and OPAs may end up being updated as a result.

The inputs to this process are clear enough, but the technique of earned value management (EVM) and associated techniques (forecasting, TCPI) are so vital to project management that they deserve some posts of their own, which I will begin with starting tomorrow.

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1. Contingency Reserves and Management Reserves

Every project faces risks that some event may occur which may impact the project’s schedule. That is why it is necessary to list the known or predictable risks before the start of a project and list them in the risk register. The next step in dealing with the risks is in devising a risk response strategy in case they occur.

To fund these risk responses, a project manager needs to set up contingency reserves, the contingency in this case being if a certain risk occurs at some point in the project. These contingency reserves are in control of the project manager, and the funds are spent out of these reserves if the predicted risk actually does comes about.

However, there may be risks that are unknown or not predicted in advance. You cannot develop a risk response in advance because you don’t know what the risks are going to be in advance. If a risk occurs that is not predicted, you need to develop a workaround or ad hoc solution to the problem. How are these workarounds funded? With management reserves. The amount of these reserves is determined before the project begins, but as opposed to contingency reserves, they are not under control of the project manager. The project sponsor must approve their use, and that is why a project sponsor must be notified if one of these “unknown” or unpredicted risks occurs, because that sponsor will have to

approve the use of funds from the management reserves in order to deal with the problem.

The two levels of reserves mean that there are three separate categories of cost aggregation to deal with on a project.

2. Cost Estimate, Cost Baseline, and Project Budget

The cost estimate for all the work packages is aggregated or “rolled up” the various levels of the WBS or Work Breakdown Structure, including the “control accounts,” until one gets to the level of the entire project, and this is the cost estimate for the project itself.

That is the first cost aggregation to be aware of. The contingency reserves mentioned in the first section are added to the cost estimate to get the cost baseline. This is the performance baseline against which the actual performance of the project will be measured. Note that, if certain risks do not occur during the project, then the contingency reserves to be used to respond to those risks will shrink during the course of the project, and the cost performance of the project will therefore improve automatically.

Then the management reserves are added to the cost baseline to yield the project budget. These funds are moved from the project budget into the cost baseline usually by the following procedure:

1. An unknown or unpredicted risk occurs.
   
2. A workaround to deal with the unknown risk is proposed.
   
3. This proposal is put in the form of a change request, and is analyzed in the change control process, which must include the project sponsor.
   
4. If the change is approved by the project sponsor in the change control process, then the funds from the management reserve are released from the project budget into the cost baseline.
   
5. However, the performance of the project will continue to be measured not against the project budget, but the cost baseline.
   

The 5^th Edition PMBOK® Guide not only does a better job of explaining the difference between contingency and management reserves than the 4^th Edition did, but there is a helpful chart to show the difference on p. 213. If you purchase the 5^th Edition in hardcover or download it electronically (which you can do if you are a member of PMI), you can refer to this chart which is more elaborate the conceptual scheme I have posted above.

The next post will go to the next process after the last process for Time Management in the Planning Process Group, 7.3 Determine Budget, namely the one in the Monitoring & Controlling Process Group, called process 7.4 Control Costs.

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After all the estimation done in process 7.2, it is now time to determine the budget, and that’s what this process does. The purpose of this post is to give a general overview of the inputs, tools & techniques, and outputs associated with this process.

1. Inputs

Obviously the most important inputs to the process 7.3 Determine Budget are the estimates determined in the previous process 7.2 Estimate Costs. Other important inputs come from other knowledge areas such as Scope, Time, Human Resource, Risk, and Procurement Management.

2. Tools & Techniques

Cost aggregation of the work packages gets you to the cost estimate of the project. If you add the cost of risk responses or contingency reserves, you get the cost baseline of the project. If you add the management reserves, which are not controlled by the project manager but by management, to the cost baseline, you get the cost budget.

If the funding for the project is not entirely available at the beginning of the project, but is available in periodic increments, then these project funding requirements of how much funding is released and at what point in the project need to be paid attention to so that the project does not temporarily run out of funding. Thus if the project is ahead of schedule, which is normally a good thing, and it gets too far ahead of schedule, the project may temporarily run out of funding until the next increment is available. This in a way is similar to resource leveling, but in this case the resource is not the work of a specific person on the project, but the funding for the project itself.

3. Outputs

The cost baseline is the performance baseline for costs against which the actual performance of the project is measured when the actual costs of the project at any given time are known.

The project funding requirements are an important output, because they may require the project schedule to be adjusted to the necessities of the periodic project funding requirements.

For that reason, the project schedule may be updated as one of the outputs. The activity cost estimates may be adjusted to reflect contingency reserves, and this information may also be updated in the risk register.

In the next post, I will review the three different figures of the cost estimate, cost baseline, and project budget and how they relate to the contingency and management reserves.

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