Budgeted Cost for Work Performed (BCWP)
DAU GLOSSARY DEFINITION
A measurement of the work completed (in the context of Earned Value Management (EVM)). BCWP is the value of work performed, or “earned,” when compared to the original plan, that is, the Budgeted Cost of Work Scheduled (BCWS). The BCWP is called the Earned Value.
The Budgeted Cost for Work Performed (BCWP) is the value of completed work expressed as the value of the performance budget assigned to that work. The sum of the budgets for completed work packages and completed portions of open work packages, plus the applicable portion of the budgets for level of effort and apportioned effort. May be expressed as a value for a specific period or cumulative to date.
Earned Value Management System Interpretation Guide (EVMSIG) (14 Mar 2019)
The budgeted cost for work performed, or BCWP, is the dollarized (budgeted) value of all work actually accomplished in a given period of time. The variable is also called Earned Value (EV) and symbolizes the completion of work. BCWP is not 'earned' until the work is completed.
The contractor reports the budgeted cost for all work packages completed for the contract to time now. This is the cumulative Budgeted Cost for Work Performed (BCWPcum), or EV. If the contractor has not completed all the scheduled work packages to time now, then the BCWPc will be less than the BCWScum, representing a “monetized” indication that the contractor is behind schedule, known as Schedule Variance (SV). It is important to understand that we cannot infer from EVM data alone the actual time that the contractor is behind schedule. We would have to use other analysis tools (e.g. network techniques such as Critical Path Method (CPM)) in conjunction with the IMS to forecast when the contract will be complete.
In addition to reporting the BCWPcum, the contractor also reports the cumulative Actual Cost of Work Performed (ACWPcum) for the work packages that have been completed. The difference between the BCWPcum and the ACWPcum is the Cost Variance (CV). If the actual costs at time now (i.e. ACWPcum) are higher than the earned value at time now (i.e. BCWPcum), we know that the contractor is currently over running cost and that the contractor’s Estimate at Completion (EAC) may typically be higher than the BAC.