HKSM

The performance measurement baseline (PMB) is the approved, integrated scope‑schedule‑cost baseline used to measure and manage project performance. It is the reference for earned value and variance analysis and can change only through formal change control.

Key Points

• The PMB integrates the scope, schedule, and cost baselines into a single, approved reference for performance measurement.
• It is the foundation for earned value management (EVM), including PV, EV, AC, SV, CV, SPI, and CPI.
• It is time-phased and aligned to the WBS and control accounts, enabling clear accountability.
• Contingency reserves are included in the cost baseline; management reserve is excluded from the PMB.
• Updates to the PMB require formal integrated change control and version tracking.
• Used to assess trends, forecast EAC, and support objective, data-driven decisions and reporting.

Purpose

The PMB provides a stable, approved reference to compare actual performance against planned work, timing, and cost. It enables objective measurement, timely detection of variances, and early corrective or preventive actions.

Pre-requisites

• Approved scope baseline (scope statement, WBS, and WBS dictionary).
• Developed schedule model with activities, relationships, durations, calendars, and critical path.
• Cost estimates, resource plan, and time-phased budget aggregated to control accounts and total BAC.
• Defined EVM measurement rules (e.g., 0/100, 50/50, percent complete) and coding structures.
• Risk analysis with documented contingency reserves; management reserve defined separately.
• Agreed reporting cadence, data date, thresholds, and tool configuration for baselining and statusing.

How to Set Baseline

• Finalize the scope baseline and map deliverables to a complete WBS.
• Develop the schedule to a realistic, resource-informed plan and validate logic and critical path.
• Create time-phased cost baseline by assigning resource rates and costs to scheduled work.
• Define control accounts and assign CAMs/owners; document EVM rules of credit.
• Consolidate scope, schedule, and cost into the integrated PMB; verify alignment and data date.
• Include contingency in the baseline; keep management reserve outside the PMB.
• Obtain formal approval and freeze the PMB; store the baseline with configuration/version control.

How to Use

• Status progress at the agreed data date to calculate EV and capture actual costs.
• Compare EV to PV and AC to compute variances (SV, CV) and performance indexes (SPI, CPI).
• Analyze root causes of variances at control-account level and implement corrective actions.
• Forecast EAC using appropriate methods (e.g., EAC = BAC/CPI or EAC = AC + ETC) and update outlooks.
• Report trends, variances, and forecasts to stakeholders; escalate when thresholds are exceeded.
• Maintain baseline integrity; reflect approved changes only, with clear traceability.

Change Control Rules

• All PMB changes require formal integrated change control with documented justification and approvals.
• Record each approved change with versioning, effective date, scope of change, and impacted control accounts.
• Use predefined thresholds to trigger variance analysis and potential change requests.
• Correct obvious errors in the baseline via controlled updates; do not use changes to mask performance issues.
• Re-baselining is allowed only when underlying project parameters change materially (e.g., major scope change).
• Management reserve changes do not alter the PMB until funds are released to control accounts through approval.

Example

A project has BAC = 1,000. At week 8, PV = 400, EV = 350, and AC = 420. SV = EV − PV = −50 (behind schedule). CV = EV − AC = −70 (over budget). SPI = 0.88 and CPI = 0.83 indicate performance issues. The team analyzes critical-path slippage and cost drivers at affected control accounts and proposes a recovery plan. EAC using CPI-only is EAC = BAC/CPI ≈ 1,000/0.83 ≈ 1,205, which is communicated to stakeholders pending corrective actions.

PMP Example Question

A project is tracking negative cost and schedule variances against its performance measurement baseline. What should the project manager do first?

1. Submit a change request to re-baseline the project to eliminate the variances.
2. Analyze variances at control-account level and implement corrective actions per the performance management plan.
3. Increase the management reserve to cover current overruns without changing the baseline.
4. Revise the schedule dates informally to reflect current progress and report the new plan.

Correct Answer: B — Analyze variances at control-account level and implement corrective actions per the performance management plan.

Explanation: The PMB is a controlled reference. Variances should be analyzed and addressed with corrective actions; re-baselining is considered only after approved scope or major plan changes.