You are on page 1of 2

Control Account vs Work Package Once the scope is divided in the form of WBS, work packages and activity

level, when it comes to tracking or monitoring and controlling, it is very difficult to track the project at very high level or at the lowest leve which is activity level. So to manage better we take a point between the WBS and work package, which we call it as Control ccount. Control ccount is a management control point where scope, cost and schedule are integrated and compared to the earned value for the performance measurement. Control ccount are placed at the selected management points in the WBS. !ach Control ccount is defined with a uni"ue code or an accounting number which can be used to link to the performing account system. Work #ackage is a deliverable which is obtained after decomposing the WBS. $urther if re"uired work packages are divided into activity level. %he control account is having one or more work packages. %he following figure shows about the relation or the hierarchy in which each of the components placed. Cost Baseline vs Cost Budget (Budget) &uring the cost estimation the #roject 'anager will come with some figure and will add contingency reserve which will become the Cost Baseline. On top of cost baseline based on the risk assessment management reserve will be added. %hen it becomes the Budget of the project. So the difference between the cost baseline and the budget us called the 'anagement reserve which we call it as unknown unknown (unknown). Earned Value Management(EVM) *et+s catch up with some of the terms as well as formula used to find out the project progress in terms of earnings. %he following table provides both the definition and the formula.

cronyms

cronyms $or e,ample, let+s take a project worth -.' to be completed over a span of . months. nd it is assumed that the planned or the estimated work roadmap is linearly distributed, in the sense at the end of /st month, it is supposed to complete 012 of work and the cost should be -/', at the end of 0nd month, 132 to be completed and spending should be -0' and so on. *et+s take the progress data of this project at the end of 4rd month. ssume the project is completed 532 of the work and spent about -4.1'. What is the condition of project6 $rom the above case, we can define following values7 ctual Cost( C)8-4.1', !arned 9alue(!9) is 532 of -.'8 -0..' and #lanned value(#9) is :12 of .-'8-4'. Now rest of the calculations are simple. C98!9; C80..;4.18;/./, S98!9;#980..;48;3.5, C#<8!9= C80..=4.183.5> and S#<8!9=#980..=483.?. What is the meaning of this6 %he bottom line is project is in the bad condition because of negative values in case of variance and the performance indices are below /. %he project is over budget, behind the schedule by values of -/./' and -3.5' respectively. nd for every -/ spent we are getting only 5> cents and the project is progressing at the rate of ?32 originally planned.

control account, also referred to by the abbreviation C , is a tool that is utili@ed as a management control point that involves the integration of a number of specific and key elements of a number of project specific elements, and after the successful integration, a measurement of the performance to date will take place. %he elements which are commonly integrated using the control account tool include the scope of a project, the project+s actual cost as well as the project+s budget, and the project+s schedule. Control accounts are placed at various strategic points of the project+s work breakdown structure. %hey can be thought of as convenient interchanges along the way of the process, points at which all of the work that has been completed in each of these specific areas can be integrated and any differences can be addressed if not reconciled.

Related Interests