Assignment Task: Tree Trimming Project
Lexi and Ty Drew own a plant nursery and tree farm in Pennsylvania. Much of their income comes from seasonal sales in the spring (for plants used for landscaping) and the fall (trees planted for landscaping and holiday seasonal sales of Christmas trees). Lexi is taking business classes working towards earning an MBA degree. In her current Project Management class, Lexi is learning about measuring technical performance as well as cost oversight. She was introduced to the topic of Earned Value (EV) and wondered if she and Ty were using EV for their business. She decided to discuss the topic with Ty, focusing specifically on their Tree Trimming work.
Each summer, Ty hires crews to shear fields of trees for the coming holiday season. Shearing entails having a worker use a large machete to shear the branches of the tree into a nice, cone-shaped tree. Ty describes this part of the business as follows:
A. Ty counts the number of Douglas Fir trees in the field (24,000)
B. Next, Ty negotiates a contract lump sum for shearing all of the trees in the field. The agreed upon cost for the entire field is $30,000.
C. After the first 5 days, Ty estimates that 8,000 trees have been sheared and Venmos the contractor $8,000.
Questions
Q1. Is Ty over, on, or below cost and schedule? Is he using earned value? Explain.
Q2. What information is missing from this example?
Q3. How can Ty set up a scheduling variance? Make a graph or chart to show what this would look like in detail.