How PPM Calculates Forecast and Actual Cost

This section describes how PPM calculates Forecast Labor Cost, Forecast Non-Labor Cost, Actual Labor Cost, and Actual Non-Labor Cost for lifecycle entities.

Item

Description

Formula

Notes

Proposal

 

Forecast Labor Cost

Calculates the forecasted labor costs from the staffing profile. It equals to the total sum of forecast labor costs of all positions in the staffing profile.

Forecast Labor Cost of a position = Forecast Labor Cost of Assignment/Promise of the position + Unmet Demand * rate determined by cost rule of the position

where,

Forecast Labor Cost of Assignment = Total committed effort of the assigned resource * rate determined by cost rule of the resource/position

Forecast Labor Cost of Promise = Total promised effort of the assignment * rate determined by cost rule of the position

For information about how the cost rate of a position/resource is determined, see How PPM picks up cost rules.

 

Same as it is for projects.

Actual Labor Cost

Calculate the actual labor costs from time logged against the proposal request

Actual Labor Cost = Sum of (time sheet actual effort * rate determined by cost rule for each resource)

For information about how the cost rate of a position/resource is determined, see How PPM picks up cost rules.

Same as it is for projects.

Project

 

Forecast Labor Cost

 

Calculate the forecasted labor costs from the staffing profile. It equals to the total sum of forecast labor costs of all positions in the staffing profile.

Forecast Labor Cost of a position = Forecast Labor Cost of Assignment/Promise of the position + Unmet Demand * rate determined by cost rule of the position

where,

Forecast Labor Cost of Assignment = Total committed effort of the assigned resource * rate determined by cost rule of the resource/position

Forecast Labor Cost of Promise = Total promised effort of the assignment * rate determined by cost rule of the position

For information about how the cost rate of a position/resource is determined, see How PPM picks up cost rules.

 

Actual Labor Cost

Calculate the actual labor costs from the work plan and time sheets

If time sheets are used:

Actual Labor Cost = Sum of (time sheet actual effort * rate determined by cost rule for each resource)

The actual efforts you log against time sheets and work plans are in a continuous range. However, when rolling up the actual labor cost to the financial summary, PPM breaks it down into periods. The cost of each month is calculated as follows:

Actual Labor Cost of the month X = Total Actual Cost * Working days in month X / Total working days during the period when actual efforts are logged

Example: For example, if a resource has been working on a task from July 17th to August 20th, 2013, and cost USD $10,000, then

  • The total working days is 25 days in which the working days of July is 11 days and the working days of August is 14 days.
  • The actual labor cost of this resource in July is USD $10,000 * 11 / 25 = USD $4,400, while the actual labor cost in August is USD $10,000 * 14 / 25 = USD $5,600.

If time sheets are not used:

Actual Labor Cost = Sum of (actual effort * rate determined by cost rule for each resource)

For information about how the cost rate of a position/resource is determined, see How PPM picks up cost rules.

Actual Non-Labor Cost

Calculate the actual non-labor costs from the work plan

Actual Non-Labor Costs = Sum of (actual non-labor costs for each task)

 

Asset

 

Forecast Labor Cost 1

Calculate the forecasted labor costs from the staffing profile (all labor costs are set to operating). It equals to the total sum of forecast labor costs of all positions in the staffing profile.

Forecast Labor Cost of a position = Forecast Labor Cost of Assignment/Promise of the position + Unmet Demand * rate determined by cost rule of the position

where,

Forecast Labor Cost of Assignment = Total committed effort of the assigned resource * rate determined by cost rule of the resource/position

Forecast Labor Cost of Promise = Total promised effort of the assignment * rate determined by cost rule of the position

For information about how the cost rate of a position/resource is determined, see How PPM picks up cost rules.

 

Same as it is for projects.

Actual Labor Cost

Calculate the actual labor costs from time logged against the asset (all labor costs are set to operating)

Actual Labor Cost = Sum of (time sheet actual effort * rate determined by cost rule for each resource)

For information about how the cost rate of a position/resource is determined, see How PPM picks up cost rules.

Same as it is for projects.