Budgeted cost of work performed (bcwp), Project Management

Budgeted cost of work performed (BCWP), or "earned value" (EV), in project management is the budgeted cost of work that has truly been done in carrying out a scheduled task in a particular time period. NASA's definition of the BCWP is the sum of the budgets for completed work packages and completed parts of open work packages, plus the applicable part of the budgets for level of effort and apportioned effort. BCWP is an Earned value management word and it is dissimilar from:

  • Budgeted cost of work scheduled (BCWS) : the approved budget that has been assigned to complete a scheduled task within a specific time period.
  • Actual Cost of Work Performed (ACWP) : the actual cost that has been used up, rather than the budgeted cost.

As example of the difference assume that a schedule contains:

  • a work "Test hardware" that is budgeted to cost $1000 to be done, and
  • is probable to begin at the start of January 1 and
  • Finish at the end of January 10.

At the end of January 5, the work is scheduled to be 50% complete (5 days of the scheduled 10 days). So, at the end of January 5,

  • the BCWS is $1000 (the budgeted cost) times 50% (the scheduled completion percentage), or $500.

Assume that by the end of January 5, the work is just only 30% complete. In this situation,

  • the BCWP would be $1000 (budgeted cost) times 30% (the actual completion percentage), or $300.

Also, assume that to reach the 30% complete level at the finish of January 5, $250 was actually spent.

  • Then, the ACWP would be $250.
Posted Date: 9/27/2012 4:01:21 AM | Location : United States







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