For any application or specifically for any project the one of the most concern factors are its budget management and time management in both pre development and post development phase. So to evaluate these both prime factors of any project there are many ways among which Cost Variance and Schedule Variance are the two important and main ways.
As name suggests Cost Variance is based on cost that has been spent in development of the project while Schedule Variance is based on time that has been spent in same development. So this is the main difference or characteristics about both variances however more to be discussed under following points.
Following are the important differences between Cost Variance and Schedule Variance
|Sr. No.||Key||Cost Variance||Schedule Variance|
|1||Definition||In project performance evaluation Cost variance represents the difference of the actual cost and the expected cost in development of a project.||On other hand Schedule variance represents the measurement of deviation of consumed time from the scheduled time in development of the project.|
|2||Evaluation||Cost variance is computed by Earned Value – Actual Cost.||On other hand Schedule variance is computed by Earned Value – Planned Value.|
|3||Variance indication||In case of cost variance a value of above 1 means that the project is not doing well against the budget and should be treated as under budget.||On other hand in case of schedule variance a value of above one means that the project is doing well against the schedule and should be treated as ahead of schedule.|
|4||Basis of Performance evaluation||CPI actually measures the deviation regarding the budget of the project and it describes the difference in amount of money spent on the project and amount of money expected .||On other hand SPI measures the performance regarding the scheduled time of the project and also describes the amount of time consumed on the project and time expected.|
|5||Meaning of variance||If cost variance is less than 1 then project is over budget and if it is greater than 1 then project is under budget while if it is equal to 1 then project is on estimated budget.||On other hand if schedule variance is less than 1 then project is behind schedule and if schedule variance is greater than 1 then project is ahead of schedule while if schedule variance is equal to 1 then project is on schedule.|
|6||Formulae for calculation||As mentioned above cost variance is the measurement of deviation from the estimated cost of the project so CV = Earned Value – Actual Cost.||On other hand in case of schedule variance is the deviation from the scheduled time for project SV = Earned Value – Planned Value.|