Thresholds are predefined acceptable tolerances for cost and schedule variances. Management by exception is an efficient way to manage a large project concentrating on areas that exceed predefined thresholds. For each code in a code or resource file, it is possible to specify either a positive or a negative threshold for cost and schedule variances. It is also possible to specify whether the threshold is based on a fixed value or a percentage.
When the variance calculated exceeds the predefined threshold defined for the code, PM Compass highlights the variance in the Explain Variance form. For example, assume that an unfavorable threshold of 10% is defined for a specific WBS element. Then, if the actual costs associated with that WBS element exceed the earned costs by 10% or more, the variance is highlighted as an unfavorable cost variance.
PM Compass uses two different types of thresholds:
Explanation of Variance (EoV) thresholds
Cost Analysis view color banding for project-level thresholds
Cobra allows for the specification of reporting thresholds against breakdown structure codes. These thresholds, or tolerances, define how large the cost variances (BCWP - ACWP) and/or schedule variances (BCWP - BCWS) must be before exception reporting mechanisms are triggered.
For each element in a breakdown structure, it is possible to specify either a positive or a negative threshold for cost and schedule variances. It is also possible to specify whether the threshold is based on a fixed value or a percentage.
In the Project Details view on the threshold tab, you identify which code file contains the thresholds for the selected project. You also select the OR - Value or Percentage option or the AND - Value and Percentage option in the Threshold Configuration group box. These thresholds are used to trigger the color codeing when an Explanation of Variance is created.
After selecting the option to schedule the creation of an Explain Variance when these thresholds are exceeded, you can use the Scheduling tab in Workflow Type Configuration to schedule the automatic creation of the EoV's. For more details about this and analyzing the variances in hours, see Thresholds tab.
The color banding (see below) is used in all other places including all reports.
PM Compass uses color banding to indicate how metrics in cost analysis, cost progress, and the Project List View should be colored to distinguish whether a particular control account is doing well or having a problem. The color codes are defined on the Thresholds tab of the Projects form by selecting the Use Color Banding check box and defining the color bands in the Cost Analysis Color Banding Ranges group box.
The variances using the following color codes:
Red — Unsatisfactory
Yellow — Marginal
Green — Good
Blue — Excellent
The color codes for the Cost Analysis view are defined using the Use Color Banding check box and the Cost Analysis Color Banding Ranges group box on the Thresholds tab of the Projects form.
You can use the Advanced view of the Control Account Search dialog box to create filters that enable you to view control accounts or work packages that exceed predefined tolerances. For example, you can create a filter that displays only control accounts whose CPI is greater than 1.5.
Automatically Create Explanation of Variances
Find control accounts or work packages that are not progressing according to plan
View time phased resource data for a control account or work package
Set up project-level thresholds
Set up a project for explain variance
Schedule the creation of Explanation of Variances