The impact of a limited budget on the corrective action taking process
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Publication type
Journal article with impact factorPublication Year
2020Journal
European Journal of Operational ResearchPublication Volume
286Publication Issue
3Publication Begin page
1070Publication End page
1086
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The main goal of project control is to identify the deviations between the baseline schedule and the actual progress of the project by measuring the project performance in progress and using the project control methodologies to generate warning signals that act as triggers for corrective actions to bring the project back on track. To that purpose, tolerance limits are set on the required project performance, such that if the warning signals exceed these limits, they should result in appropriate corrective actions. In this paper, the Earned Value Management (EVM) control method and its extensions are used to test their abilities in taking corrective actions under a budget constraint. More precisely, four different approaches are proposed for allocating the limited budget along the different project phases, and whether a proper allocation of the budget results in an increase of the expected project outcome is measured. A large computational experiment is conducted on a set of artificial projects to assess the efficiency and effectiveness of the budget allocation models. Results show that simply allocating budget according to the time accrue of projects performs better than methods that take cost, time/cost or risk information into account. Moreover, results indicate that allocating a budget that increases in later stages of the project is beneficial for the outcome.Knowledge Domain/Industry
Operations & Supply Chain Managementae974a485f413a2113503eed53cd6c53
10.1016/j.ejor.2020.03.069