CALCULATE SCHEDULE - A modeling process that defines all critical activities and individual activity scheduling data. The process applied in most scheduling software calculates the start and finish dates of activities in two passes. The first pass calculates early start and finish dates from the earliest start date forward. The second pass calculates the late start and finish activities from the latest finish date backwards. The difference between the pairs of start and finish dates for each task is the float or slack time for the task. See also: FLOAT. (June 2007) CALENDAR - Defined work periods and holidays that determine when project activities may be scheduled. Multiple calendars may be used for different activities, which allows for more accurate modeling of the project work plan. E.g., 5-day work week calendar vs. 7-day work week. See also: CALENDAR UNIT; GLOBAL CALENDAR. (June 2007) CALENDAR RANGE - Span of the calendar from calendar start through end date. The calendar start date is unit number one. The calendar range is usually expressed in years. (November 1990) CALENDAR UNIT - The smallest common/standard unit of time used in a particular calendar for scheduling an activity or a project. Calendar units are generally in hours, days, or weeks, but can also be shifts or even minutes. See also: CALENDAR; TIME UNIT. (June 2007) CALENDAR START DATE - The date assigned to the first unit of the defined calendar; the first day of the schedule. (November 1990) CAPACITY FACTOR - In cost estimating, an exponential factor used in the capacity factor estimating method. Syn.: CAPACITY UTILIZATION FACTOR; SCALING FACTOR. See also: CAPACITY FACTOR METHOD. (June 2007) CAPACITY FACTOR METHOD − A cost estimating method in which the cost of a new facility is derived from the cost of a similar item or facility of a known, but usually different capacity. In this method, the ratio of costs between two similar facilities is equal to the ratio of their capacities taken to an exponential factor (i.e., the scaling, or capacity factor). See also: SCALING FACTOR. (June 2007) CAPACITY UTILIZATION FACTOR − Syn.: CAPACITY FACTOR; SCALING FACTOR. (June 2007) CAPITAL, DIRECT - Syn.: DIRECT COSTS. (June 2007) CAPITAL, FIXED - The total original value of physical facilities which are not carried as a current expense on the books of account and for which depreciation is allowed by the Federal Government. It includes plant equipment, building, furniture and fixtures, and transportation equipment used directly in the production of a product or service. It includes all costs incident to getting the property in place and in operating condition, including legal costs, purchased patents, and paid-up licenses. Land, which is not depreciable, is often included. Characteristically it cannot be converted readily into cash. (November 1990) CAPITAL, INDIRECT - Syn.: INDIRECT COSTS. (October 2013) CAPITAL, OPERATING - Capital associated with process facilities inside battery limits. (November 1990) CAPITAL BUDGETING - A systematic procedure for classifying, evaluating, and ranking proposed capital expenditures for the purpose of comparison and selection, combined with the analysis of the financing requirements. (November 1990) CAPITAL EFFECTIVENESS - The degree to which a capital project system supports achievement of the enterprise’s objectives (e.g., profitability). See also: COMPETITIVENESS. (November 2020) CAPITAL PROJECT - A project in which the cost of the end result or product is capitalized (i.e., cost will be depreciated). The product is usually a physical asset such as property, real estate or infrastructure, but may include other assets that are depreciable. (June 2007) CAPITAL RECOVERY – (1)Charging periodically to operations amounts that will ultimately equal the amount of capital expenditure. (2)The replacement of the original cost of an asset plus interest. (3)The process of regaining the net investment in a project by means of revenue in excess of the costs from the project. (Usually implies amortization of principal plus interest on the diminishing, unrecovered balance.) See also: AMORTIZATION; DEPLETION; DEPRECIATION. (November 1990) CAPITAL RECOVERY FACTOR - A factor used to calculate the sum of money required at the end of each of a series of periods to regain the net investment of a project plus the compounded interest on the unrecovered balance. (November 1990) CAPITAL, SUSTAINING - The fixed capital requirements to: 1) Maintain the competitive position of a project throughout its commercial life by improving product quality, related services, safety, or economy; or, 2) Required to replace facilities which wear out before the end of the project life. (November 1990) CAPITAL, TOTAL - Sum of fixed and working capital. (November 1990) CAPITAL, VENTURE - Capital invested in technology or markets new at least to the particular organization. (November 1990) CAPITAL, WORKING - The funds in addition to fixed capital and land investment which a company must contribute to the project (excluding startup expense) to get the project started and meet subsequent obligations as they come due. Working capital includes inventories, cash and accounts receivable minus accounts payable. Characteristically, these funds can be converted readily into cash. Working capital is normally assumed recovered at the end of the project. (November 1990) CAPITALIZED COST – (1)The present worth of a uniform series of periodic costs that continue for an indefinitely long time (hypothetically infinite). (2)The value at the purchase date of the asset of all expenditures to be made in reference to this asset over an indefinite period of time. This cost can also be regarded as the sum of capital which, if invested in a fund earning a stipulated interest rate, will be sufficient to provide for all payments required to maintain the asset in perpetual service. (November 1990) CARDS-ON-THE-WALL PLANNING - A planning technique in which team members interact to create a project strategy, tactical approach, and resulting network by locating and interconnecting task cards using walls as the work space. The wall data are transferred into a computer model for scheduling, critical path analysis and iteration. (June 2007) CASH COSTS - Total cost excluding capital and depreciation spent on a regular basis over a period of time, usually one year. Cash costs consist of manufacturing cost and other expenses such as transportation cost, selling expense, research and development cost or corporate administrative expense. (November 1990) CASH FLOW - Inflow and outflow of funds within a project. A time-based record of income and expenditures often presented graphically. (June 2007) CASH FLOW (NET) - The net flow of funds into or out of a project. The sum, in any time period, of all cash receipts, expenses, and investments. Also called cash proceeds or cash generated. The stream of monetary values–costs and benefits–resulting from a project investment. \[1\] (June 2007) CASH FLOW MANAGEMENT - The planning of project expenditures relative to income or authorized funding in such a way as to minimize the carrying cost of the financing for the project or keep within the constraints of a time-phased budget. This may be achieved by accelerating or delaying some activities, but at the risk of ineffective performance, late completion and consequent increased cost. (June 2007) CASH RETURN, PERCENT OF TOTAL CAPITAL - Ratio of average depreciation plus average profit, to total fixed and working capital, for a year of capacity sales. Under certain limited conditions, this figure closely approximates that calculated by profitability index techniques where it is defined as the difference, in any time period, between revenues and all cash expenses, including taxes. (November 1990) CAUSATION - An explanation or description of the facts and circumstances that produce a result, the cause and effect for which the contractor claims entitlement to compensation from the owner under the contract. (November 1990) CAUSE OF RISK - Syn.: RISK DRIVERS. (December 2011) CERTAINTY - Unquestionable. Free of doubt. No risk involved. (June 2007) CHAIN - A series of elements joined together in sequence, such as a logical series of activities or occurrences. (June 2007) CHANGE - Alteration or variation to a scope of work and/or the schedule for completing the work. (November 1990) CHANGE, CARDINAL - Work that is beyond the scope of that specified in the contract and consequently unauthorized. The basic tests for a cardinal change are whether the type of work was within the contemplation of the parties when they entered into the contract and whether the job as modified is still the same basic job. (November 1990) CHANGE, CONSTRUCTIVE - An act or failure to act by the owner or the engineer that is not a directed change, but which has the effect of requiring the contractor to accomplish work different from that required by the existing contract documents. (November 1990) CHANGE, UNILATERAL - Syn.: MODIFICATION, UNILATERAL. (November 1990) CHANGE CONTROL – (1)Process of accepting or rejecting changes to the project's baselines. Lack of change control is one of the most common causes of scope creep. (2)Process of implementing procedures that ensure that proposed changes are properly assessed and, if approved, incorporated into the project plan. Uncontrolled changes are one of the most common causes of delay and failure. (3)Risk abatement process of accepting or rejecting changes to the project's baselines, based on predetermined criteria or "trigger points.” See also: CHANGE MANAGEMENT. (June 2007) CHANGE DOCUMENTATION/LOG - Records of changes proposed, accepted and rejected. (June 2007) CHANGE DRIVER - A project modification that influences scope, quality, schedule, or cost. (November 2020) CHANGE IN SCOPE - A change in the defined deliverables or resources used to provide them. Syn.: SCOPE CHANGE. (June 2007) CHANGE IN SEQUENCE - A change in the order of work initially specified or planned by the contractor. If this change is ordered by the owner and results in additional cost to the contractor, the contractor may be entitled to recovery under the changes clause. (November 1990) CHANGE MANAGEMENT - The formal process through which changes to the project plan are identified, assessed, reviewed, approved and introduced. (June 2007) CHANGE NOTICE - The form that is used by the owner to communicate a change in scope or baseline to the contract. See also: CHANGE ORDER. (October 2013) CHANGE ORDER - A document requesting and/or authorizing a scope and/or baseline change or correction. 1) From the owner’s perspective, it is an agreement between the project team and higher authority approving a change in the project control baseline. 2) From a contractor’s perspective, it is an agreement between the owner and the contractor to compensate for a change in scope or other conditions of a contract. It must be approved by both the client and the contractor before it becomes a legal change to the contract. (June 2007) CHANGED CONDITIONS - Syn.: DIFFERING SITE CONDITIONS. (November 1990) CHART OF ACCOUNTS - Syn.: CODE OF ACCOUNTS (COA). (June 2007) CHILD - A lower-level element in a hierarchical structure. See also: PARENT. (June 2007) CHILD ACTIVITY - Subordinate task belonging to a 'parent' task existing at a higher level in the work breakdown structure. (June 2007) CLAIM - A demand or assertion of rights by one party against another for damages sustained under the terms of a legally binding contract. Damages might include money, time, or other compensation to make the claimant whole. (August 2007) CLIENT – (1)Party to a contract who commissions the work. On capital projects, may also be referred to as the “owner”. (2)Customer, principal, owner, promoter, buyer, or end user of the product or service created by the project. \[8\] (June 2007) CLOSEOUT - The completion of project work. The phase at the end of a project lifecycle just before the operations begins. (June 2007) CODE - A referencing system typically applied to the elements of work and cost breakdown structures. (June 2007) CODE OF ACCOUNTS (COA) - A systematic coding structure for organizing and managing scope, asset, cost, resource, work, and schedule activity information. A COA is essentially an index to facilitate finding, sorting, compiling, summarizing, or otherwise managing information that the code is tied to. A complete code of accounts includes definitions of the content of each account. Syn.: CHART OF ACCOUNTS. See also: COST CODES. (June 2007) CODING - The process of applying a code. See also: ACTIVITY CODE; CODE OF ACCOUNTS (COA). (June 2007) COMMISSIONING - Activities performed to substantiate the capabilities of individual units and systems to function as designed. May include performance tests on mechanical equipment, water washing, flushing and drying of equipment and piping, control systems operability checks, checking of safety and fire protection devices, and operation of systems on inert fluids. Commissioning normally follows mechanical completion and ends with initial operation or startup. See also: STARTUP. (June 2007) COMMITTED COST - A cost which has not yet been paid, but an agreement, such as a purchase order or contract, has been made that the cost will be incurred. See also: COMMITMENTS. (June 2007) COMMITMENTS - The sum of all financial obligations made, including incurred costs and expenditures as well as obligations, which will not be performed until later. (November 1990) COMMODITY - In price index nomenclature, a good and sometimes a service. (November 1990) COMPANY - Term used primarily to refer to a business first party, the purpose of which is to supply a product or service. In a capital project, typically refers to the contractor who is performing services for an owner or client. (June 2007) COMMON CAUSE VARIATION - Fluctuation caused by unknown factors resulting in a steady but random distribution of output around the average of the data. It is the remaining variation after removing special causes. See also: SPECIAL CAUSE VARIATION. (October 2018) COMPETITIVENESS - In respect to benchmarking, the quality of practices, processes and/or measures (e.g., cost, schedule, profit, etc.) being as good as or better in comparison to that of competitors or to one’s past. See also: BENCHMARKING; CAPITAL EFFECTIVENESS. (November 2020) COMPLETED ACTIVITY - An activity with an actual completion date and remaining duration of zero. An activity that is finished, ended and/or concluded in accordance with requirements. (June 2007) COMPLETION (CONTRACT) - When the entire work has been performed to the requirements of the contract, except for those items arising from the provisions of warranty, and is so certified. (June 2007) COMPLETION DATE (PLANNED) - The calculated date for completion derived from estimating, planning and risk evaluation taking into account contingencies for identified risks. (June 2007) COMPOSITE PRICE INDEX - An index which measures the price change of a range or group of commodities. (May 2012) COMPOUND AMOUNT - The future worth of a sum invested (or loaned) at compound interest. (November 1990) COMPOUND AMOUNT FACTOR – (1)The function of interest rate and time that determines the compound amount from a stated initial sum. (2)A factor which when multiplied by the single sum or uniform series of payments will give the future worth at compound interest of such single sum or series. (November 1990) COMPOUND INTEREST – (1)The type of interest that is periodically added to the amount of investment (or loan) so that subsequent interest is based on the cumulative amount. (2)The interest charges under the condition that interest is charged on any previous interest earned in any time period, as well as on the principal. (November 1990) COMPOUND RISK - Syn.: RISK (IMPACT) COMPOUNDING. (December 2011) COMPOUNDING, CONTINUOUS – (1)A compound interest situation in which the compounding period is zero and the number of periods infinitely great. A mathematical concept that is practical for dealing with frequent compounding and small interest rates. (2)A mathematical procedure for evaluating compound interest factors based on a continuous interest function rather than discrete interest periods. (November 1990) COMPOUNDING PERIOD - The time interval between dates at which interest is paid and added to the amount of an investment or loan. Designates frequency of compounding. (November 1990) CONCEPT DEFINITION DOCUMENT - A document describing the concept selected for development and the results of investigating alternative system concepts. It is used to derive the system specifications and the statement of work. Syn.: SYSTEM CONCEPT DOCUMENT. (June 2007) CONCEPT PHASE - First phase of a project in which need is examined, alternatives are assessed, the goals and objectives of the project are established and a sponsor is identified. (June 2007) CONCEPTUAL ESTIMATE - An estimate generally prepared based on very limited information. See also: COST ESTIMATE CLASSIFICATION SYSTEM, CLASS 4 ESTIMATE; COST ESTIMATE CLASSIFICATION SYSTEM, CLASS 5 ESTIMATE. (May 2012) CONCEPTUAL SCHEDULE - Similar to a proposal schedule except it is usually time-scaled and developed from the abstract or conceptual design of the project. Used primarily to give the client a general idea of the project scope and on overview of activities. (June 2007) CONCERN - In TCM risk management, something that worries stakeholders because it may give rise to a risk event or condition. See also: CONDITION (RISK CONDITION); EVENT. (December 2011) CONCURRENCY - Degree to which independent activities may be, or are performed at the same time (fully or partially). Degree to which phases, stages, or activities may be overlapped. (June 2007) CONCURRENT ACTIVITIES - Independent activities that may be, or are performed at the same time (fully or partially). (June 2007) CONCURRENT DELAYS – (1)Two or more delays that take place or overlap during the same period, either of which occurring alone would have affected the ultimate completion date. In practice, it can be difficult to apportion damages when the concurrent delays are due to the owner and contractor respectively. (2)Concurrent delays occur when there are two or more independent causes of delay during the same time period. The “same” time period from which concurrency is measured, however, is not always literally within the exact period of time. For delays to be considered concurrent, most courts do not require that the period of concurrent delay precisely match. The period of “concurrency” of the delays can be related by circumstances, even though the circumstances may not have occurred during exactly the same time of period. \[10\] (3)True concurrent delay is the occurrence of two or more delay events at the same time, one an employer risk event, the other a contractor risk event and the effects of which are felt at the same time. The term ‘concurrent delay’ is often used to describe the situation where two or more delay events arise at different times, but the effects of them are felt (in whole or in part) at the same time. To avoid confusion, this is more correctly termed the ‘concurrent effect’ of sequential delay events. \[12\] (4)Concurrent delay occurs when both the owner and contractor delay the project or when either party delays the project during an excusable but non-compensable delay (e.g., abnormal weather). The delays need not occur simultaneously but can be on two parallel critical path chains. \[13\] (5)The condition where another delay-activity independent of the subject delay is affecting the ultimate completion of the chain of activities. (June 2007) CONDITION (RISK CONDITION) - Any specific identifiable circumstance that might affect the outcome of the project. See also: RISK EVENT. (December 2011) CONDITIONAL BRANCHING - Schedule analysis that allows for changes in schedule logic and/or durations depending on the occurrence of risk events or conditions. See also: DYNAMIC RISK ANALYSIS. (December 2011) CONDITIONAL RISK - Risk that occurs under certain conditions or is accepted provided that certain conditions are met. (June 2007) CONFIDENCE INTERVAL - The probability that a result will be within a range. See also: ACCURACY RANGE; RANGE. (December 2011) CONFIDENCE LEVEL - The probability: 1) That results will be equal to or more favorable than the amount estimated or quoted; or 2) That the decision made will achieve the desired results; or 3) That the stated conclusion is true. Note: Confidence level may also be expressed as "equal to or less favorable". If that is the case, it should so be noted. Without such a note, the definition shown is assumed. (June 2007) CONFIGURATION - A collection of an item's descriptive and governing characteristics, which can be expressed: 1) In functional terms, i.e. what performance the item is expected to achieve; and 2) In physical terms, i.e. what the item should look like and consist of when it is completed. (June 2007) CONFIGURATION CONTROL - A system of procedures that monitors emerging project scope against the scope baseline. Requires documentation and management approval on any change to the baseline. (June 2007) CONFIGURATION MANAGEMENT - Technical and administrative activities concerned with the creation, maintenance and controlled change of configuration throughout the life of the product. Configuration management is an integral part of life-cycle management. (June 2007) CONFLICT - Two or more parties having differing interests or perspectives that require resolution to achieve project goals. The state that exists when two groups have goals that will affect each other differently. (June 2007) CONFLICT IN PLANS AND SPECIFICATIONS - Statements or meanings in the contract documents (including drawings and specifications) that cannot be reconciled by reasonable interpretation on the part of the contractor and which may require the owner to provide an interpretation between alternatives. (November 1990) CONFLICT MANAGEMENT - Handling of conflicts between project participants or groups in order to create optimal project results. (June 2007) CONSENT OF SURETY - An acknowledgement by a surety that its bond, given in connection with a contract, continues to apply to the contract as modified; or, at the end of a contract, permission from the surety to release all retainage to the contractor. (November 1990) CONSEQUENCE - In risk management, the impact or effect of a risk event or condition. Syn.: EFFECT; IMPACT. See also: CONDITION (RISK CONDITION); EVENT. (December 2011) CONSTANT BASKET - A set of goods and services with quantities fixed in relation to a given time period, used for computing composite price indexes. (November 1990) CONSTANT BASKET PRICE INDEX - A price index which measures price changes by comparing the expenditures necessary to provide the same set of goods and services at different points in time. (November 1990) CONSTANT DOLLARS - Dollars of uniform purchasing power exclusive of general inflation or deflation. Constant dollars are tied to a reference year. Syn.: REAL DOLLARS. \[1\] (November 1990) CONSTANT UTILITY PRICE INDEX - A composite price index which measures price changes by comparing the expenditures necessary to provide substantially equivalent sets of goods and services at different points in time. (November 1990) CONSTRAINT – (1)In planning and scheduling, any external factor that affects when an activity can be scheduled. A restriction imposed on the start, finish or duration of an activity. The external factor may be resources, such as labor, cost or equipment, or, it can be a physical event that must be completed prior to the activity being restrained. Constraints are used to reflect project requirements more accurately. Examples of date constraints are: Start-no-earlier-than, finish-no-later-than, mandatory start, and as-late-as-possible. (2)In decision and risk management, something that limits the potential achievement of objectives. Syn.: RESTRAINT. (December 2011) CONSTRAINT DATE - Syn.: PLUG DATE. (November 1990) CONSTRUCTABILITY – (1)A system (process) for achieving optimum integration of construction knowledge in the construction process, balancing various project and environmental constraints to achieve maximization of project goals and performance. \[6\] (2)Derived from early detailed construction planning that allows engineering and procurement to be scheduled to support construction in accordance with the overall optimized project schedule. \[5\] (3)The extent to which the design of a structure or system facilitates ease of construction, subject to the overall requirements for the completed form. The optimum use of construction knowledge and experience in planning, engineering, procurement and field operations to achieve the overall objective. (June 2007) CONSTRUCTION COST - The sum of all costs, direct and indirect, inherent in converting a design plan for material and equipment into a project ready for start-up, but not necessarily in production operation; the sum of field labor, supervision, administration, tools, field office expense, materials, equipment, and subcontracts. (June 2007) CONSTRUCTION MANAGEMENT – (1)Project management as applied to construction. (2)A professional service that applies to effective management techniques to the planning, design, and construction of a project from inception to completion for the purpose of controlling time, cost, and quality. \[16\] (June 2007) CONSTRUCTION PROGRESS - Construction progress is monitored and reported as percent complete. Actual work units completed are measured against the planned work units for each applicable account in the bill of materials or quantities. Usually reported against individual accounts by area and total project and summarized by area and total project. (June 2007) CONSTRUCTION PROGRESS REPORT - A report that informs management of overall construction progress (physical percent complete), costs, performance and manpower at a specific reporting cut-off date. Typically includes major accomplishments, objectives for the upcoming report period, areas of concern, and other pertinent information necessary for management and control. (June 2007) CONSTRUCTIVE ACCELERATION - An owner’s action or inaction, in absence of a specific direction to accelerate, that results in the contractor accelerating its work to maintain scheduled completion date(s). Case law has identified five elements normally required to establish a claim for constructive acceleration and include: 1) An excusable delay must exist; 2) Timely notice of the delay and a proper request for a time extension must have been given; 3) The time extension must have been postponed or refused; 4) Owner must have ordered (either by coercion, direction or some other manner) the project completed within its original performance period; and 5) Contractor must actually accelerate its performance, thereby incurring excess costs. (June 2007) CONSTRUCTIVE CHANGE - An owner's action or inaction that impacts the contractor's working conditions and constitutes an unauthorized modification of contract intent. (June 2007) CONSTRUCTIVE DELAY - An act or omission by the owner or its agent, which in fact delays completion of the work. (June 2007) CONSUMABLE RESOURCE - A type of resource that remains available until consumed (for example, a material). (June 2007) CONSUMABLES - Supplies and materials used up during construction. Includes utilities, fuels and lubricants, welding supplies, worker's supplies, medical supplies, etc. (November 1990) CONSUMERS PRICE INDEX (CPI) - A measure of time-to-time fluctuations in the price of a quantitatively constant market basket of goods and services, selected as representative of a special level of living. (November 1990) CONTINGENCY – (1)An amount added to an estimate to allow for items, conditions, or events for which the state, occurrence, or effect is uncertain and that experience shows will likely result, in aggregate, in additional costs. Typically estimated using statistical analysis or judgment based on past asset or project experience. Contingency usually excludes: 1) Major scope changes such as changes in end product specification, capacities, building sizes, and location of the asset or project; 2) Extraordinary events such as major strikes and natural disasters; 3) Management reserves; and 4\) Escalation and currency effects. Some of the items, conditions, or events for which the state, occurrence, and/or effect is uncertain include, but are not limited to, planning and estimating errors and omissions, minor price fluctuations (other than general escalation), design developments and changes within the scope, and variations in market and environmental conditions. Contingency is generally included in most estimates and is expected to be expended. See also: MANAGEMENT RESERVE. (2)In earned value management (based upon the ANSI EIA 748 Standard), an amount held outside the performance measurement baseline for owner level cost reserve for the management of project uncertainties is referred to as contingency. (October 2013) CONTINGENCY PLAN - A risk response plan made to address identified residual risks if they occur. Syn.: FALLBACK PLAN. See also: CONTINGENT RISK RESPONSE; RESIDUAL RISK. (December 2011) CONTINGENT RISK RESPONSE - A planned alternative response to a risk that will be taken only in defined circumstances. See also: RISK RESPONSE. (December 2011) CONTRACT - Legal agreement between two or more parties, which may be of the types enumerated below: 1.CONTRACT, COST PLUS CONTRACTS - In cost plus contracts the contractor agrees to furnish to the client services and material at actual cost, plus an agreed upon fee for these services. This type of contract is employed most often when the scope of services to be provided is not well defined. a.CONTRACT, COST PLUS CONTRACTS, COST PLUS PERCENTAGE BURDEN AND FEE - the client will pay all costs as defined in the terms of the contract, plus "burden and fee" at a specified percent of the labor costs which the client is paying for directly. This type of contract generally is used for engineering services. In contracts with some governmental agencies, burden items are included in indirect cost. b.CONTRACT, COST PLUS CONTRACTS, COST PLUS FIXED FEE - the client pays costs as defined in the contract document. Burden on reimbursable technical labor cost is considered in this case as part of cost. In addition to the costs and burden, the client also pays a fixed amount as the contractor's "fee". c.CONTRACT, COST PLUS CONTRACTS, COST PLUS FIXED SUM - the client will pay costs defined by contract plus a fixed sum which will cover "non-reimbursable" costs and provide for a fee. This type of contract is used in lieu of a cost plus fixed fee contract where the client wishes to have the contractor assume some of the risk for items which would be reimbursable under a cost plus fixed fee type of contract. d.CONTRACT, COST PLUS CONTRACTS, COST PLUS PERCENTAGE FEE - the client pays all costs, plus a percentage for the use of the contractor's organization. 2.CONTRACT, FIXED PRICE CONTRACTS - Fixed price types of contract are ones wherein a contractor agrees to furnish services and material at a specified price, possibly with a mutually agreed upon escalation clause. This type of contract is most often employed when the scope of services to be provided is well defined. a.CONTRACT, FIXED PRICE CONTRACTS, LUMP SUM - contractor agrees to perform all services as specified by the contract for a fixed amount. A variation of this type may include a turn-key arrangement where the contractor guarantees quality, quantity and yield on a process plant or other installation. b.CONTRACT, FIXED PRICE CONTRACTS, UNIT PRICE - contractor will be paid at an agreed upon unit rate for services performed. For example, technical work-hours will be paid for at the unit price agreed upon. Often field work is assigned to a subcontractor by the prime contractor on a unit price basis. c.CONTRACT, FIXED PRICE CONTRACTS, GUARANTEED MAXIMUM (TARGET PRICE) - a contractor agrees to perform all services as defined in the contract document guaranteeing that the total cost to the client will not exceed a stipulated maximum figure. Quite often, these types of contracts will contain special share-of- the-saving arrangements to provide incentive to the contractor to minimize costs below the stipulated maximum. d.CONTRACT, FIXED PRICE CONTRACTS, BONUS-PENALTY - a special contractual arrangement usually between a client and a contractor wherein the contractor is guaranteed a bonus, usually a fixed sum of money, for each day the project is completed ahead of a specified schedule and/or below a specified cost, and agrees to pay a similar penalty for each day of completion after the schedule date or over a specified cost up to a specified maximum either way. The penalty situation is sometimes referred to as liquidated damages. (November 1990) CONTRACT BUDGET BASELINE (CBB) - In earned value management according to the ANSI EIA 748 standard, the budget for the project at the total contract level. The CBB reconciles with the project authorization documents from the owner. The CBB plus fee is the total contract value. CBB = performance measurement baseline (PMB) + management reserve (MR) unless an over target baseline (OTB) has been implemented. (October 2013) CONTRACT CHANGE - An authorized modification to terms of a contract. May involve but is not limited to: 1) A change in the volume or conditions of the work involved; 2) The number of units to be produced; 3) The quality of the work or units; 4) The time for delivery; and/or 5) The consequent cost involved. (June 2007) CONTRACT COMPLETION DATE - The date established in the contract for completion of all or specified portions of the work. This date may be expressed as a calendar date or as a number of days after the date for commencement of the contract time is issued. (November 1990) CONTRACT DATES - The start, intermediate, or final dates specified in the contract that impact the project schedule. See also: SCHEDULED DATES. (June 2007) CONTRACT DOCUMENTS - The agreement, addenda (which pertain to the contract documents), contractor's bid (including documentation accompanying the bid and any post-bid documentation submitted prior to the notice of award) when attached as an exhibit to the agreement, the bonds, the general conditions, the supplementary conditions, the specifications and the drawings as the same are more specifically identified in the agreement, together with all amendments, modifications and supplements issued pursuant to the general conditions on or after the effective date of the agreement. (November 1990) CONTRACT MASTER SCHEDULE - The management summary schedule that shows the overall plan for the total contract. (June 2007) CONTRACT PLAN - The conditions, methods, schedule, etc. for carrying out the work of the contract as agreed between the parties at the time of signing the contract. (June 2007) CONTRACT PRICE - The monies payable by the owner to the contractor under the contract documents as stated in the agreement. (November 1990) CONTRACT "READ AS A WHOLE" - Reading an entire contract document, instead of reading each clause in the contract in isolation. If a clause is ambiguous and can be interpreted in more than one way, the meaning that conforms to the rest of the document is usually the accepted meaning. (November 1990) CONTRACT TIME - The number of days within which, or the dates by which, the work, or any specified part thereof, is to be completed. (November 1990) CONTRACTOR – (1)A business entity that enters into contracts to provide goods or services to another party. (2)A person or organization that undertakes responsibility for the performance of a contract. One that agrees to furnish materials or perform services at a specified price. (June 2007) CONTROL – (1)Management action, either preplanned to achieve the desired result or taken as a corrective measure prompted by the monitoring process. (2)To take timely corrective action. Control occurs only if monitoring and forecasting activities indicate an undesirable final result is likely to occur and that a different final result is possible. (3)Process of comparing actual performance with planned performance, analyzing the differences, and taking the appropriate corrective action. (June 2007) CONTROL ACCOUNT (CA) - A management control point where earned value measurement takes place. It is the place where scope, schedule and budget, are integrated at the organizational level responsible for day to day management of a segment of the project. Syn.: COST ACCOUNT. (October 2013) CONTROL ACCOUNT MANAGER (CAM) - The single person responsible for management of the scope, schedule, and budget of the control account. The CAM has control either through delegation or supervisory responsibility for all of the staff performing the control account work. (October 2013) CONTROL AND COORDINATION - Control is the process of developing targets and plans; measuring actual performance and comparing it against planned performance and taking the steps to correct the situation. Coordination is the act of ensuring that work is being carried out in different organizations and places to fit together effectively in time, content and cost in order to achieve the project objectives effectively. (June 2007) CONTROL BASELINE - Syn.: BASELINE. (June 2007) CONTROL GATE - A major project milestone at which the project client has the opportunity to exercise a ‘go/no-go’ decision upon continuation into the succeeding phase. (June 2007) CONTROL SCHEDULE - The most recent update to a project schedule including current progress status and accepted changes. This is the current schedule used to manage the project on a regular basis as defined in the contract. The control schedule is distinct from a baseline schedule, which is fixed. See also: CURRENT SCHEDULE; SCHEDULE UPDATE. (November 2020) CONTROLLING PATH - An alternate term used in place of ‘as-built critical path’ in order to technically preserve the use of the term critical path to denote only to activity paths identified by float calculation using early and late dates. By definition, as-built activities do not have early and late dates. (June 2007) CONTROLLING RELATIONSHIP - In planning and scheduling, the predecessor activity logic tie to an activity, with multiple predecessors, which “controls” or “drives” that activity and establishes it’s latest early finish. (June 2007) CORRECTION PERIOD - The period of time within which the contractor shall promptly, without cost to the owner and in accordance with the owner's written instructions, either correct defective work, or if it has been rejected by the owner, remove it from the site and replace it with non-defective work, pursuant to the general conditions. (November 1990) CORRELATION - The measure of the relationship between two or more quantitative elements. (December 2011) COST - In project control and accounting, it is the amount measured in money, cash expended, or liability incurred, in consideration of goods and/or services received. From a total cost management perspective, cost may include any investment of resources in strategic assets including time, monetary, human, and physical resources. (January 2002) COST ACCOUNT - Syn.: CONTROL ACCOUNT (CA). (October 2013) COST ACCOUNTING - The historical reporting of actual and/or committed disbursements (costs and expenditures) on a project. Costs are denoted and segregated within cost codes that are defined in a chart of accounts. In project control practice, cost accounting provides the measure of cost commitment and/or expenditure that can be compared to the measure of physical completion (or earned value) of an account. (January 2003) COST ANALYSIS - A historical and/or predictive method of ascertaining for what purpose expenditures on a project were made and utilizing this information to project the cost of a project as well as costs of future projects. The analysis may also include application of escalation, cost differentials between various localities, types of buildings, types of projects, and time of year. (November 1990) COST/SCHEDULE CONTROL SYSTEM CRITERIA (C/SCSC) - A standard method of earned value management used on US Government projects. C/SCSC combined time and cost measures to better measure performance in an integrated way. This standard was superseded by a government earned value management system (EVMS) standard. (June 2007) COST APPROACH - One of the three approaches in the appraisal process. Underlying the theory of the cost approach is the principle of substitution, which suggests that no rational person will pay more for a property than the amount with which he/she can obtain, by purchase of a site and construction of a building without undue delay, a property of equal desirability and utility. (November 1990) COST AT COMPLETION (CAC) - The amount an activity or group of activities will cost when it has been completed. It is the sum of the cost expended to date and the estimated cost to complete. See also: INDICATED TOTAL COST. (June 2007) COST AVOIDANCE - An action taken in the present designed to decrease costs in the future. (June 2007) COST BASELINE - A time-phased budget used to measure and monitor cost performance. It is developed by summing estimated costs by period and is usually displayed in the form of an S-curve. See also: BASELINE. (October 2013) COST BREAKDOWN STRUCTURE (CBS) – (1)A hierarchical structure that divides budgeted resources into elements of costs, typically labor, materials and other cost categories. The lowest level, when assigned responsibility, typically defines a cost center. (2)Hierarchical breakdown of a project into cost elements or cost categories. See also: COST CATEGORY; COST CENTER. (October 2019) COST CATEGORY - A specifically defined division in a system of classification for estimated and/or expended money for which costs are to be summarized. (June 2007) COST CENTER - The smallest unit of activity or area of responsibility against which costs are accumulated; defined sections in the corporate system, representing units of responsibility as well as accounting units. (June 2007) COST CODES - Codes allocated to items or activities that allow costs to be consolidated according to the elements of the coding structure. See also: CHART OF ACCOUNTS; CODE OF ACCOUNTS (COA). (June 2007) COST CONTROL - The application of procedures to monitor expenditures and performance against progress of projects or manufacturing operations; to measure variance from authorized budgets and allow effective action to be taken to achieve minimum costs. (November 1990) COST CONTROL SYSTEM - Any system of managing costs within the bounds of budgets or standards based upon work actually performed. Cost control is typically performed at designated levels in the work breakdown structure. (June 2007) COST CURVE - A graph that plots cumulative cost (e.g., planned, expended, incurred, etc.) against a time scale. See also: CASH FLOW. (June 2007) COST DISTRIBUTION - Distribution or allocation of overhead (indirect) costs on some logical basis, e.g., the time or cost of all associated direct cost activities. See also: ALLOCATION. (June 2007) COST ELEMENT - In earned value, a basic unit of planning such as: labor, travel, material, subcontracts, and other cost categories as applicable. (October 2019) COST ENGINEER - A professional whose judgment and experience are used in the application of scientific principles and techniques to the areas of business planning and management science, profitability analysis, estimating, decision and risk management, cost control, planning, scheduling, and dispute resolution, etc. to support asset, project, program, and portfolio management. (April 2019) COST ENGINEERING - The application of scientific principles and techniques to the areas of business planning and management science, profitability analysis, estimating, decision and risk management, cost control, planning, scheduling, and dispute resolution, etc. to support asset, project, program, and portfolio management. (April 2019) COST ESTIMATE - A compilation of all the probable costs of the elements of a project or effort included within an agreed upon scope. (May 2012) COST ESTIMATE CATEGORY - Syn.: COST ESTIMATE CLASS; COST ESTIMATE CLASSIFICATION SYSTEM; COST ESTIMATE TYPE. (January 2004) COST ESTIMATE CLASS - Syn.: COST ESTIMATE CATEGORY; COST ESTIMATE CLASSIFICATION SYSTEM; COST ESTIMATE TYPE. (January 2004) COST ESTIMATE CLASSIFICATION SYSTEM - There are numerous characteristics that can be used to categorize project cost estimate types. Some of these characteristics are: level of project definition, end usage of the estimate, estimating methodology, and the effort and time needed to prepare the estimate. AACE recommends that the primary characteristic used to define the classification category is the level of project definition. The other characteristics are considered secondary. The level of project definition defines maturity, or the extent and types of input information available to the estimating process. Such inputs include project scope definition, requirements documents, specifications, project plans, drawings, calculations, lessons learned from past projects, reconnaissance data, and other deliverables and information that must be developed to define the project. Each industry will have a typical set of defining deliverables that are used to support the type of estimates used in that industry. The set of deliverables becomes more definitive and complete as the level of project definition (e.g., project engineering) progresses. For projects, the estimate class designations that follow below are labeled Class 1, 2, 3, 4, and 5. A Class 5 estimate is based upon the lowest level of project definition, and a Class 1 estimate is closest to full project definition and maturity. This “countdown” approach considers that estimating is a process whereby successive estimates are prepared until a final estimate closes the process. 1.COST ESTIMATE CLASSIFICATION SYSTEM, CLASS 5 ESTIMATE – (Typical level of project definition required: >0% to 2% of full project definition.) Class 5 estimates are generally prepared based on very limited information, and subsequently have wide accuracy ranges. As such, some companies and organizations have elected to determine that due to the inherent inaccuracies, such estimates cannot be classified in a conventional and systemic manner. Class 5 estimates, due to the requirements of end use, may be prepared within a very limited amount of time and with little effort expended. Class 5 estimates are prepared for any number of strategic business planning purposes, such as but not limited to market studies, assessment of initial viability, evaluation of alternate schemes, project screening, project location studies, evaluation of resource needs and budgeting, long-range capital planning, etc. 2.COST ESTIMATE CLASSIFICATION SYSTEM, CLASS 4 ESTIMATE – (Typical level of project definition required: 1% to 15% of full project definition.) Class 4 estimates are generally prepared based on limited information and subsequently have fairly wide accuracy ranges. They are typically used for project screening, determination of feasibility, concept evaluation, and preliminary (but generally not final) budget approval. Class 4 estimates are prepared for a number of purposes, such as but not limited to, detailed strategic planning, business development, project screening at more developed stages, alternative scheme analysis, confirmation of economic and/or technical feasibility, and preliminary budget approval or approval to proceed to next stage. 3.COST ESTIMATE CLASSIFICATION SYSTEM, CLASS 3 ESTIMATE – (Typical level of project definition required: 10% to 40% of full project definition.) Class 3 estimates are generally prepared to form the basis for budget authorization, appropriation, and/or funding. Class 3 estimates are typically prepared to support full project funding requests and become the first of the project phase “control estimate” against which all actual costs and resources will be monitored for variations to the budget. They are used as the project budget until replaced by more detailed estimates. In many owner organizations, a Class 3 estimate may be the last estimate required and could well form the only basis for cost/schedule control. 4.COST ESTIMATE CLASSIFICATION SYSTEM, CLASS 2 ESTIMATE – (Typical level of project definition required: 30% to 75% of full project definition.) Class 2 estimates are generally prepared to form a detailed control baseline against which all project work is monitored in terms of cost and progress control. For contractors, this class of estimate is often used as the “bid” estimate to establish contract value. 5.COST ESTIMATE CLASSIFICATION SYSTEM, CLASS 1 ESTIMATE – (Typical level of project definition required: 65% to 100% of full project definition.) Class 1 estimates are generally prepared for discrete parts or sections of the total project rather than for the entire project. The parts of the project estimated at this level of detail will typically be used by subcontractors for bids, or by owners for check estimates. The updated estimate is often referred to as the current control estimate and becomes the new baseline for cost/schedule control of the project. Class 1 estimates may be prepared for parts of the project to comprise a fair price estimate or bid check estimate to compare against a contractor’s or vendor’s bid estimate, or to evaluate/dispute claims or change orders. Syn.: COST ESTIMATE CATEGORY; COST ESTIMATE CLASS; COST ESTIMATE TYPE. See also: AACE Recommended Practices No. 17R-97 “Cost Estimate Classification System” and No. 18R-97 “Cost Estimate Classification System - As Applied in Engineering, Procurement, and Construction for the Process Industries”. (January 2004) COST ESTIMATE RESOURCE - Cost estimate of physical resources needed to perform a specific construction activity which in turn drives an overall unit price. Typically includes labor resources, material resources, equipment resources, subcontractor costs and other costs. It is typically abbreviated LMESO. (December 2011) COST ESTIMATE TYPE - Syn.: COST ESTIMATE CATEGORY; COST ESTIMATE CLASS; COST ESTIMATE CLASSIFICATION SYSTEM. (January 2004) COST ESTIMATING - Cost estimating is the predictive process used to quantify, cost, and price the resources required by the scope of an investment option, activity, or project. Cost estimating is a process used to predict uncertain future costs. In that regard, a goal of cost estimating is to minimize the uncertainty of the estimate given the level and quality of scope definition. The outcome of cost estimating ideally includes both an expected cost and a probabilistic cost distribution. As a predictive process, historical reference cost data (where applicable) improve the reliability of cost estimating. Cost estimating, by providing the basis for budgets, also shares a goal with cost control of maximizing the probability of the actual cost outcome being the same as predicted. (November 2012) COST ESTIMATING RELATIONSHIP (CER) - In estimating, an algorithm or formula that is used to perform the costing operation. CERs show some resource (e.g., cost, quantity, or time) as a function of one or more parameters that quantify scope, execution strategies, or other defining elements. A CER may be formulated in a manner that, in addition to providing the most likely resource value, also provides a probability distribution for the resource value. (May 2012) COST ESTIMATOR (PROJECT) - Project cost estimators predict the cost of a project for a defined scope, to be completed at a defined location and point of time in the future. Cost estimators assist in the economic evaluation of potential projects by supporting the development of project budgets, project resource requirements, and value engineering. They also support project control by providing input to the cost control baseline. Estimators collect and analyze data on all of the factors that can affect project costs such as: materials, equipment, labor, location, duration of the project, and other project requirements. (November 2012) COST INDEX - A number which relates the cost of an item at a specific time to the corresponding cost at some specified prior time. See also: PRICE INDEX. (June 2007) COST LOADING - In planning and scheduling, assigning an estimated or actual cost to an activity. The estimated cost may be only direct costs or may include indirect costs. However, the CPM (critical path method) must be developed using only one cost loading method. (June 2007) COST OF CAPITAL - A term, usually used in capital budgeting, to express as an interest rate percentage the overall estimated cost of investment capital at a given point in time, including both equity and borrowed funds. (November 1990) COST OF LOST BUSINESS ADVANTAGE - The cost associated with loss of repeat business and/or the loss of business due to required resources and costs. (November 1990) COST OF OWNERSHIP - The cost of operations, maintenance, follow-on logistical support, and end item and associated support systems. See also: OPERATING COST. \[3\] (November 1990) COST OF QUALITY – (1)Consists of the sum of those costs associated with: (a) Cost of quality conformance; (b) Cost of quality nonconformance; and (c) Cost of lost business advantage. (2)Cost incurred or expended to ensure quality, including those associated with the cost of conformance and nonconformance. \[8\] (June 2007) COST OF QUALITY CONFORMANCE - The cost associated with the quality management activities of appraisal, training, and prevention. (November 1990) COST OF QUALITY NONCONFORMANCE - The cost associated with deviations involving rework and/or the provision of deliverables that are more than required. (November 1990) COST PERFORMANCE INDEX/INDICATOR (CPI) - The ratio of earned value to actual costs (CPI = BCWP/ACWP). A value greater than 1 indicates that costs are running under budget. A value less than 1 indicates that costs are running over budget. Often used to predict magnitude of a possible cost overrun by dividing it into the original cost estimate (original cost estimate/CPI = projected cost at completion). (June 2007) COST PERFORMANCE REPORT (CPR) - A common report used to report earned value management (EVM) information to an owner. (October 2013) COST TO COMPLETE - The amount that an in-progress activity or group of activities will cost to complete. (June 2007) COST VARIANCE - The difference between the earned value and actual cost. Cost variance (CV) = budgeted cost of work performed (BCWP) - actual cost of work performed (ACWP). A negative cost variance indicates that the activity(ies) is running over budget. (June 2007) COST OF LIVING INDEX - In modern usage, a price index based on a constant utility concept as opposed to a constant basket concept. (November 1990) COSTING – (1)The application of cost and resources to a quantified scope. (2)A process of determining actual costs from actual expenditures. The way costs are estimated, and the way money is spent are rarely the same, making it necessary to analyze and redistribute actual expenditures to arrive at cost data that is useful for future estimating purposes. (May 2012) COSTING, ACTIVITY BASED (ABC) - Costing in a way that the costs budgeted to an account truly represent all the resources consumed by the activity or item represented in the account. (January 2003) CPM - Syn.: CRITICAL PATH METHOD (CPM). (June 2007) CRASH COSTS - The cost of reducing an activity to its crash duration. (June 2007) CRASH DURATION - When needing to shorten a network critical path, activities may be 'crashed'. This represents drastic action to reduce the duration of a critical activity and should only be taken in exceptional circumstances due to a dramatic increase in resource consumption. (June 2007) CRASHING - Action to decrease the duration of an activity or project by increasing the expenditure of resources. (June 2007) CREW - A set of workers and work equipment designated to perform an activity. (January 2014) CREW HOUR - An hour of effort for a crew of workers. For example, if a crew has 2 workers, a crew hour includes 2 labor hours. (June 2007) CREW RATE - Labor cost per crew hour for a given crew. The labor cost may include only wages or wages plus benefits, burdens, and other markups. The labor cost may also include an allowance for the costs of tools and equipment used by the crew in performance of their work. See also: LABOR COST. (June 2007) CRITICAL ACTIVITY - An activity on the project’s critical path. A delay to a critical activity causes a corresponding delay in the completion of the project. Although some activities are “critical,” in the dictionary sense, without being on the critical path, this meaning is seldom used in the project context. (June 2007) CRITICAL CHAIN - That set of tasks which determines the overall duration of a project, after considering resource capacity. It is typically regarded as the constraint or leverage point of a project. (June 2007) CRITICAL CHAIN METHOD - Differentiated from the critical path method, this project planning and management technique considers resources that constrain the work, not only the precedence of activities. The method determines the longest-duration sequence of resource-constrained activities through a project network–thus, the shortest-possible project duration–the critical chain. Algorithms for application of the method are both deterministic and stochastic. Time buffers are included to protect completion dates and provide adequate solutions, since contingency is removed from durations of individual activities. (August 2007) CRITICAL ELEMENT - A cost element or a profit element which, due to its potential variability, can change the bottom-line, either favorably or unfavorably, by an amount equal to or greater than its critical variance. See also: CRITICAL VARIANCE. (December 2011) CRITICAL PATH - The longest continuous chain of activities (may be more than one path) which establishes the minimum overall project duration. A slippage or delay in completion of any activity by one time period will extend final completion correspondingly. The critical path by definition has no “float.” See also: LONGEST PATH (LP). (June 2007) CRITICAL PATH ANALYSIS - Procedure for calculating the critical path and floats in a network. (June 2007) CRITICAL PATH METHOD (CPM) – (1)Technique used to predict project duration by analyzing which sequence of activities has least amount of scheduling flexibility. Early dates are figured by a forward pass using a specific start date and late dates are figured by using a backward pass starting from a completion date. (2)Network scheduling using activity durations and logic ties between activities to model the plan to execute the work. CPM scheduling is the method of choice for managing projects of long duration, complex technical integration, or the need to coordinate fast or early completion of the work. Syn.: CPM. (June 2007) CRITICAL RELATIONSHIP - A driving relationship between two critical activities, thus defining which activity influences the final completion of the project. (June 2007) CRITICAL SEQUENCE - Sequence of activities having zero float after resource limits are taken into account in calculating float. (June 2007) CRITICAL SEQUENCE ANALYSIS - A process of calculating a critical sequence of activities while taking into account resource limits that reflects an activity's flexibility. (June 2007) CRITICAL TASK - A task that must finish on time for the entire project to finish on time. If a critical task is delayed, the project completion date is also delayed. A critical task has zero slack time. A series of critical tasks make up the project’s critical path. (June 2007) CRITICAL VARIANCE - A percentage of the bottom-line used to identify critical elements. The percentage is a function of the class of estimate (Class 1 or 2 vs. Class 3, 4, or 5) and the type of bottom-line (cost or profit). If necessary, the percentage can be increased to a maximum of twice its base value in order to reduce the number of qualifying elements to an acceptable number (typically 20 or so) in order to avoid introducing iatrogenic risk. See also: BOTTOM-LINE; CRITICAL ELEMENT. (December 2011) CRITICALITY - A measure of the significance or impact of failure of a product, process, or service to meet established requirements. (November 1990) CRITICALITY INDEX - Describes how often a particular task was on the critical path during the quantitative risk analysis (e.g., Monte Carlo computer simulation). Expressed as a factor between 0 and 1 or as a percentage. Tasks with a high criticality index appear more frequently on the critical path. When combined with the duration sensitivity, it determines the cruciality index. (December 2011) CRUCIALITY - The degree that a change in a risk model element produces a change in the overall outcome (i.e., strong risk drivers have high cruciality). In schedule risk, cruciality of an activity increases with its criticality (i.e., sometimes referred to as the product of sensitivity and criticality). See also: CRITICALITY; RISK DRIVERS. (December 2011) CRUDE MATERIALS - Includes products entering the market for the first time which have not been fabricated or manufactured but will be processed before becoming finished goods (e.g., steel scrap, wheat, raw cotton). Syn.: RAW MATERIALS. (November 1990) CURRENT COST ACCOUNTING (CCA) - a methodology prescribed by the Financial Accounting Board to compute and report financial activities in constant dollars. (November 1990) CURRENT DATE LINE - A vertical line in a Gantt chart, resource graph, or other charts with dates on one axis, indicating the current date. (June 2007) CURRENT DOLLARS - Dollars of purchasing power in which actual prices are stated, including inflation or deflation. In the absence of inflation or deflation, current dollars equal constant dollars. \[1\] (November 1990) CURRENT FINISH DATE - The current estimate of the calendar date when an activity will be completed. (June 2007) CURRENT PERIOD (OF A GIVEN PRICE INDEX) - Period for which prices are compared to the base period prices. (November 1990) CURRENT SCHEDULE - Schedule update, which reflects actual progress to date, plus forecast progress going forward and is accepted/used for monitoring and controlling the work. See also: CONTROL SCHEDULE. (November 2020) CURRENT START DATE - The current estimate of the calendar date when an activity will begin. (June 2007) CURRENT STATUS - In project control, a report that compares actual progress with planned progress as of the last reporting date. (June 2007) CUSTOM IN THE INDUSTRY - An established practice in a particular industry in the general area. It may be used to show the practice to be followed in a particular circumstance. (November 1990) CUSTOMER - The ultimate consumer, user, client, beneficiary or second party who will be responsible for acceptance of the project's deliverables. (June 2007) CUSTOMER FURNISHED EQUIPMENT (CFE) - Equipment provided to the contractor doing the project by the customer for the project and typically specified in the contract. Also referred to as owner furnished material/equipment (OFM/OFE). (June 2007) CUTOFF DATE - The ending date in a reporting period. (June 2007) CYCLE TIME - The time duration that it takes to create a deliverable. Includes time for both direct effort on the deliverable and time spent on other activities, projects or processes that intentionally or unintentionally add to the duration. (June 2007) DAILY CREW OUTPUT - The amount of work accomplished by a crew in one day (typically 8 hours). This is a special form of production rate. (January 2014) DAMAGES, ACTUAL - The increased cost to one party resulting from another party's acts or omissions affecting the contract but not incorporated into a contract modification. (November 1990) DAMAGES, LIQUIDATED - An amount of money stated in the contract as being the liability of a contractor for failure to complete the work by the designated time(s). Liquidated damages ordinarily stop at the point of substantial completion of the project or beneficial occupancy by the owner. Also, can apply to contract defined output performance. Syn.: LIQUIDATED DAMAGES. (June 2007) DAMAGES, RIPPLE - Syn.: IMPACT COST. (April 2004) DANGLE - An activity in a network that has neither predecessors nor successors. (June 2007) DATA DATE – (1)The point in time (typically reported as a calendar date) through \[\*\] which progress is incorporated into the schedule (actual dates, percent complete, remaining durations, actual resources, etc.), separating actual data from the forecast. (2)The point in time (typically reported as a calendar date) to \[\*\] which progress is incorporated into the schedule (actual dates, percent complete, remaining durations, actual resources, etc.), separating actual data from the forecast. \[\*\] The method chosen should be used consistently throughout the project. Syn.: AS-OF DATE; UPDATE DATE; TIME NOW. See also: PROGRESS DATE; STATUS DATE; SCHEDULE UPDATE. (October 2018) DATE CONSTRAINT - A fixed date imposed on an activity to force it to start or finish by or on a certain date in a schedule model. A date constraint overrides the logic of the schedule and can, if improperly used, cause unintended results. (June 2007) DATE FOR THE COMMENCEMENT OF THE CONTRACT TIME - The date when the contract time commences to run and on which the contractor shall start to perform the contractor's obligations under the contract documents. (November 1990) DATE OF ACCEPTANCE - Date on which the client agrees to final acceptance of the project. Commitments against the authorized funds usually cease at this time. This is an event. See also: DELIVERY. (June 2007) DAY WORK ACCOUNT - A method of payment for work not included in the scope of the contract that the construction contractor is obliged to perform at the request or direction of the owner or its agent. Generally, such day work account is paid for on unit-price or cost-plus terms. (June 2007) DE-SCOPE - For earned value, project scope removed with a separate contractual action. It is scope with schedule and budget that is returned to the owner for other uses. The net result is the total project budget is reduced, and the overall duration of the project may also be reduced. Alternately, the amount of project scope removed may be kept in Undistributed Budget/Schedule Margin until returned to the owner. See also: PROJECT SCOPE. (October 2013) DECELERATION - The opposite of acceleration. A direction, either expressed or implied, to slow down job progress. (November 1990) DECISION ANALYSIS (DA) - A systematic and typically quantitative process for selecting the optimum of two or more alternatives in order to address a problem or opportunity. (December 2011) DECISION BASIS - Refers to the definition of the components or criteria on which a decision is based. Generally includes defined alternatives, information, and preferences. See also: DECISION POLICY. (December 2011) DECISION DRIVER - Variables in a decision model that influence decision outcomes. (December 2011) DECISION EVENT - State in the progress of a project when a decision is required before the start of any succeeding activity. The decision determines which of a number of alternative paths is to be followed. (June 2007) DECISION FRAMING - Methods to identify, define, layout or frame the decision to be addressed during the structuring step of decision analysis. See also: DECISION ANALYSIS (DA). (December 2011) DECISION IMPLEMENTATION - In decision analysis, this refers to the process step for implementing the selected alternative and performing continuous improvement. (December 2011) DECISION MODEL - A quantitative model that that provides a base methodology that supports objective, consistent and appropriate decision making by an organization considering all agreed model inputs and outputs. See also: DECISION POLICY. (June 2007) DECISION POLICY - Definitive position of an organization on how investment or project decisions will be made. Establishes the basis for decision models. Provides a basis for consistent and appropriate decision making and defines authority and accountability within the organization. See also: POLICY. (June 2007) DECISION QUALITY CHAIN - A generally recognized quality management model for decision analysis. It includes the following elements: a. Appropriate frame, b. Creative, doable alternatives, c. Meaningful, reliable information, d. Clear values and trade-offs, e. Logically correct reasoning, and f. Commitment to action. See also: DECISION ANALYSIS. (December 2011) DECISION TREE - A graphical representation of the decision process. Sequential decisions are drawn in the form of branches of a tree, stemming from an initial decision point and extending all the way to final outcomes. Each path through branches of the tree represents a separate series of decisions and probabilistic events. (June 2007) DECISIONS UNDER CERTAINTY - Simple decisions that assume complete information and no uncertainty connected with the analysis of the decisions. (November 1990) DECISIONS UNDER RISK - A decision problem in which the analyst elects to consider several possible futures, the probabilities of which can be estimated. (November 1990) DECISIONS UNDER UNCERTAINTY AND RISK - A decision for which the analyst elects to consider several possible futures, the probabilities of which cannot be estimated. (December 2011) DECLINING BALANCE DEPRECIATION - Method of computing depreciation in which the annual charge is a fixed percentage of the depreciated book value at the beginning of the year to which the depreciation applies. Syn.: PERCENT ON DIMINISHING VALUE. (November 1990) DECOMPOSITION - Separation of the scope of work and requirements into smaller, component packages, so that work effort can be more effectively monitored and controlled. (August 2007) DE-ESCALATE - A method to convert present-day costs or costs of any point in time to costs at some previous date via applicable indexes. (November 1990) DEFECT - A deviation of a severity sufficient to require corrective action. (November 1990) DEFECTIVE - An adjective which, when modifying the work, refers to work that is unsatisfactory, faulty or deficient, or does not conform to the contract documents, or does not meet the requirements of any inspection, reference standard, test or approval referred to in the contract documents, or has been damaged prior to the engineer's recommendation of final payment (unless responsibility for the protection thereof has been assumed by the owner at substantial completion in accordance with the contract documents). (November 1990) DEFECTIVE SPECIFICATIONS - Specifications and/or drawings which contain errors, omissions, and/or conflicts, which affect or prevent the contractor's performance of the work. (November 1990) DEFECT, LATENT - A defect in the work which cannot be observed by reasonable inspection. (November 1990) DEFECT, PATENT - A defect in the work which can be observed by reasonable inspection. (November 1990) DEFINITION (PROJECT) - Process of quantifying performance and interface requirements during system decomposition and elaboration phase of a project. See also: LIFE CYCLE; LIFE CYCLE, PROJECT LIFE CYCLE. (June 2007) DEFINITION PHASE - An early phase in the project life cycle when the scope is defined. Syn.: DEVELOPMENT PHASE; FRONT END; PLANNING PHASE. (June 2007) DEFINITIVE ESTIMATE - An estimate generally involving a high degree of deterministic estimating methods. It is generally prepared in great detail. See also: COST ESTIMATE CLASSIFICATION, CLASS 1 ESTIMATE; COST ESTIMATE CLASSIFICATION, CLASS 2 ESTIMATE. (May 2012) DEFLATION - A persistent decrease in the level of consumer prices, or a persistent increase in the purchasing power of money caused by a decrease in available currency and credit relative to the proportion of available goods and services (i.e., negative inflation). See also: INFLATION. (December 2011) DELAY - To cause the work or some portion of the work to start or be completed later than planned or later than scheduled. (April 2004) DELAY, COMPENSABLE – (1)Delays that are caused by the owner's actions or inactions. Contractor is entitled to a time extension and damage compensation for extra costs associated with the delay. (2)If the delay is deemed compensable the party will be entitled to additional compensation for the costs of delay, as well as additional time for contract performance. However, it is possible for a delay to be compensable without extending the contract performance time. Generally speaking, a delay that could have been avoided by due care of one party is compensable to the innocent party suffering injury or damage as a result of the delay’s impact. \[10\] (3)A contractor is entitled to recover for delay costs and a time extension provided that three conditions are satisfied: 1) The delay is caused by the owner or is within the owner’s control; 2) The delay results in additional costs to the contractor; and 3) The contractor has not assumed the risk of delay. Because this entitlement is implied in every contract, it does not need to be expressly stated in the contract. \[11\] (June 2007) DELAY, CONCURRENT - Two or more delays in the same time frame or which have an independent effect on the end date. The owner/engineer and the contractor may each be responsible for delay in completing the work. This may bar either party from assessing damage against the other. This may also refer to two or more delays by the same party during a single time period. (November 1990) DELAY, EXCUSABLE - Any delay beyond the control and without the fault or negligence of the contractor or the owner, caused by events or circumstances such as, but not limited to, acts of God or of the public enemy, acts of interveners, acts of government other than the owner, fires, floods, epidemics, quarantine restrictions, freight embargoes, hurricanes, tornadoes, labor disputes, etc. Generally, a delay caused by an excusable delay to another contractor is compensable when the contract documents specifically void recovery of delay costs. (November 1990) DELAY, INEXCUSABLE - Any delay caused by events or circumstances within the control of the contractor, such as inadequate crewing, slow submittals, etc., which might have been avoided by the exercise of care, prudence, foresight, or diligence on the part of the contractor. (November 1990) DELAY, NONPREJUDICIAL - Any delay impacting a portion of the work within the available total float or slack time, and not necessarily preventing completion of the work within the contract time. (November 1990) DELAY, PACING – (1)Deceleration of the project work, by one of the parties to the contract, due to a delay to the end date of the project caused by the other party, so as to maintain steady progress with the revised overall project schedule. (2)A delay resulting from a conscious and contemporaneous decision to pace progress of an activity against another activity experiencing delay due to an independent cause. (3)The consumption of float created by another delay, in performing work on an activity not directly dependent on the progress of the work experiencing the other delay. (June 2007) DELAY, PARENT - The alleged owner-caused delay that created or increased the relative total float consumed by the pacing delay. The parent delay must start or exist prior to the pacing delay. Also, the parent delay must be on the critical path or have a lower float value than the paced activity prior to pacing. (June 2007) DELAY, PREJUDICIAL - Any excusable or compensable delay impacting the work and exceeding the total float available in the progress schedule, thus preventing completion of the work within the contract time unless the work is accelerated. (November 1990) DELAYING RESOURCE - In resource planning and scheduling, inadequate availability of one or more resources may require that completion of an activity be delayed beyond the date on which it could otherwise be completed. The delaying resource is the first resource on an activity that causes the activity to be delayed. (June 2007) DELIVERABLE – (1)A report or product of one or more tasks that satisfy one or more objectives and must be delivered to satisfy contractual requirements. (2)Another name for products, services, processes, or plans created as a result of doing a project. A project typically has interim as well as final deliverables (June 2007) DELIVERY - Transfer or handover of a product from one party to another. Syn.: TURNOVER. (June 2007) DELPHI TECHNIQUE - A forecasting technique that seeks expert consensus by sharing their opinions with each other anonymously after each round of forecasts. Based on the array of anonymous expert opinions then shared, panel participants rethink and reforecast for the next round. When forecasts are congruent or nearly so, the forecasting process is complete. (August 2007) DEMAND FACTOR – (1)The ratio of the maximum instantaneous production rate to the production rate for which the equipment was designed. (2)The ratio between the maximum power demand and the total connected load of the system. (November 1990) DEMING CYCLE - Syn.: PLAN-DO-CHECK-ACT (PDCA) CYCLE. (June 2007) DEMURRAGE - A charge made on cars, vehicles, or vessels held by or for consignor or consignee for loading or unloading, for forwarding directions or for any other purpose. (November 1990) DEPENDENCIES - Relationships between products or tasks. For example, one product may be made up of several other 'dependent' products or a task may not begin until a 'dependent' task is complete. See also: RELATIONSHIP. (June 2007) DEPENDENCY - A relation between activities, such that one requires input from the other. (June 2007) DEPENDENT VARIABLE - An event or condition whose impact or probability of occurrence depends on another variable. See also: INDEPENDENT VARIABLE. (December 2011) DEPLETION – (1)A form of capital recovery applicable to extractive property (e.g., mines). Depletion can be on a unit-of-output basis related to original or current appraisal of extent and value of the deposit. (Known as percentage depletion.) (2)Lessening of the value of an asset due to a decrease in the quantity available. Depletion is similar to depreciation except that it refers to such natural resources as coal, oil, and timber in forests. (November 1990) DEPRECIATED BOOK VALUE - The first cost of the capitalized asset minus the accumulation of annual depreciation cost charges. (November 1990) DEPRECIATION – (1)Decline in value of a capitalized asset. (2)A form of capital recovery applicable to a property with a life span of more than one year, in which an appropriate portion of the asset's value is periodically charged to current operations. (November 1990) DESCRIPTIVE - Portrayal of content in words, either orally or written. When applied to instructions, implies information concerning how something is to be done, rather than step by step details of what is to be done, i.e. prescriptive. (June 2007) DESIGN & DEVELOPMENT PHASE - Definition phase in a generic project life cycle that encompasses detailed technical, commercial and organizational decisions. There is often substantial opportunity to optimize these decisions without expenditure of significant resources by modeling, prototyping and testing. Management approval gates are necessary where major decisions will be made. In some industries, this phase is dealt with as two separate phases with a management gate between the two. This allows design to be matured before approval is given for significant resource expenditure on full design/development. Equally, the gate may be required before major procurement decisions and commitments are made after initial design but prior to full design/development. See also: DEFINITION PHASE. (June 2007) DESIGN DEVELOPMENT - Process of identifying and verifying technical solutions to meet requirements of conceptual design. Takes conceptual design to next level of detail, but not as detailed as the detailed design stage. Depending on size and nature of project, it may be a separate stage in the project life cycle. (June 2007) DESIGN REVIEW - A formal, documented, comprehensive and systematic examination of a design to evaluate design requirements and capability of the design to meet these requirements and to identify problems and propose solutions. (June 2007) DESIRABLE LOGIC - Network logic that is desirable for the contractor (but not necessarily for the client), based on some preference or advantage. Desirable logic may impose unnecessary conditions that preclude an optimum solution. See also: IRREFUTABLE LOGIC; PREFERENTIAL LOGIC. (June 2007) DETAILED ENGINEERING - The detailed design, drafting, engineering, and other related services necessary to purchase equipment and materials and construct a facility. (November 1990) DETAILED REQUIREMENT - A requirement that describes the specific function that a particular product provides at a level of detail sufficient to support execution of the work. \[8\] (June 2007) DETAIL(ED) SCHEDULE – (1)A schedule used to communicate the day-to-day activities to working levels on the project. The detailed schedule would typically cover activities up to at least the next major milestone. The detailed schedule supports and is consistent with the master schedule. (2)A schedule, which displays the lowest level of detail necessary to control the project through job completion. The intent of this schedule is to finalize remaining requirements for the total project. (June 2007) DETERMINISTIC ESTIMATE - An estimate where none of the variables are probabilistic and that is developed using deterministic methods (i.e., not subject to significant conjecture). In some usage, this term is synonymous with BASE ESTIMATE (even if the base estimate is developed using stochastic methods). (December 2011) DETERMINISTIC NETWORK/MODEL – (1)A network with no facilities to accommodate probabilistic dependencies. Precedence networks are said to be deterministic. (2)A deterministic model, as opposed to a stochastic model, contains no random elements and for which, therefore, the future course of the system is determined by its state at present (and/or in the past). (June 2007) DEVELOPMENT - Process of working out and extending theoretical, practical, and/or useful application of an idea, concept, or preliminary design. (June 2007) DEVELOPMENT COSTS - Those costs specific to a project, either capital or expense items, which occur prior to commercial sales and which are necessary in determining the potential of that project for consideration and eventual promotion. Major cost areas include process, product, and market research and development. (November 1990) DEVELOPMENT PHASE - Syn.: DEFINITION PHASE; FRONT END; PLANNING PHASE. (June 2007) DEVIATION – (1)A departure from established requirements. Deviations occur when the work product either fails to meet or unnecessarily exceeds the requirements. The change (positive or negative) may be considered potential or it may already be in the process of actually occurring. The deviation is used to provide a detailed description and detailed estimate (or ROM estimate) of change impacts that are the result of design developments, productivity, omissions, errors, price fluctuation, supplier changes, etc., or anything else that changes the forecast cost and schedules. Deviations are documented by project controls and communicated to the project manager. A deviation provides the project team with an opportunity to mitigate an adverse impact or to optimize the outcome and is used primarily as a communication tool. Note: Deviation as used herein refers to a single point variance. Trend refers to a pattern of a data group. (2)In systems engineering, a deviation in the work product may be classified as an imperfection, nonconformance, or defect. (June 2007) DEVIATION COSTS - The sum of those costs, including consequential costs such as schedule impact, associated with the rejection or rework of a product, process, or service due to a departure from established requirements. Also, may include the cost associated with the provision of deliverables that are more than required. (November 1990) DIAGRAMMING (SCHEDULE) - Syn.: SCHEDULING. (June 2007) DIFFERING SITE CONDITIONS - Subsurface or latent physical conditions at the site differing materially from those conditions indicated in the contract documents or unknown physical conditions at the site, of an unusual nature, differing materially from conditions normally encountered and generally recognized as inherent in work of the nature provided for in the contract. (November 1990) DIRECT COSTS - Costs of completing work that are directly attributable to its performance and are necessary for its completion. 1) In construction, the cost of installed equipment, material, labor and supervision directly or immediately involved in the physical construction of the permanent facility. 2) In manufacturing, service, and other non-construction industries: the portion of operating costs that is readily assignable to a specific product or process area. Syn.: CAPITAL, DIRECT. (June 2007) DIRECT PACING - When the paced event has a logical relationship to the parent delay. (June 2007) DISCIPLINE – (1)Area of technical expertise or specialty. \[8\] (2)A discrete area of study and endeavor where only specialized education and experience enable the full comprehension of the content of the subject matter and its appropriate application. (August 2007) DISCONTINUOUS ACTIVITY - An activity in which the interval between start and finish dates is allowed to exceed its duration in order to satisfy start-to-start and finish-to-finish relationships with other activities. (June 2007) DISCOUNTED CASH FLOW – (1)The present worth of a sequence in time of sums of money when the sequence is considered as a flow of cash into and/or out of an economic unit. (2)An investment analysis which compares the present worth of projected receipts and disbursements occurring at designated future times in order to estimate the rate of return from the investment or project. Also called discounted cash flow rate of return, interest rate of return, internal rate of return, investor's method or profitability index. Syn.: INVESTOR’S METHOD. (November 1990) DISCOUNTED PAYBACK PERIOD (DPP) - The time required for the cumulative benefits from an investment to pay back the investment cost and other accrued costs considering the time value of money. \[1\] (November 1990) DISCOUNT FACTOR - A multiplicative number (calculated from a discount formula for a given discount rate and interest period) that is used to convert costs and benefits occurring at different times to a common time. \[1\] (November 1990) DISCOUNTING - A technique for converting cash flows that occur over time to equivalent amounts at a common time. \[1\] (November 1990) DISCOUNT RATE - The rate of interest reflecting the investor's time value of money, used to determine discount factors for converting benefits and costs occurring at different times to a base time. The discount rate may be expressed as nominal or real. \[1\] (November 1990) DISCRETE EFFORT - Tasks that have a specific measurable end product or end result. Discrete tasks are ideal for earned value measurement. See also: WORK PACKAGE. (June 2007) DISCRETE MILESTONE - A milestone that has a definite scheduled occurrence. (June 2007) DISCRETE TASK - A measurable activity with an output. (June 2007) DISCRETIONARY DEPENDENCY - Dependency defined by preference, rather than necessity. These are typically employed in preferential or soft logic. (June 2007) DISINFLATION - A decrease in the rate of inflation (for example, a change in the rate of inflation from 4% to 2%). Differs from, but may portend deflation. (December 2011) DISPATCHING - The selecting and sequence of jobs to be run at individual work stations and the assignment of these jobs to workers. In many companies, dispatching is done by the actual shop line supervisor, set-up worker or lead worker. A dispatcher is usually a representative of the production control department which handles this job assignment task. (November 1990) DISPUTE - A disagreement between the owner and the contractor as to a question of fact or contract interpretation which cannot be resolved to the mutual satisfaction of the parties. (November 1990) DISRUPTION - An interference (action or event) with the orderly progress of a project or activity(ies). Disruption has been described as the effect of change on unchanged work and manifests itself primarily as adverse labor productivity impacts. If such disruption is caused by owner or engineer action (or failure to act), the contractor may be entitled to recover any resulting costs. See also: RIPPLE EFFECT. (June 2007) DISTRIBUTABLES - The portion of a project’s cost that cannot be associated with any specific direct account. In construction, this includes the field non-manual staff, field office, office supplies, temporary construction, utilities, small tools, construction equipment, weather protection, snow removal, lost time, labor burden, etc. When completion cost reports are prepared, the distributable costs may be distributed across the direct accounts for fixed asset accounting. See also: INDIRECT COSTS. (June 2007) DOCUMENT – (1)(noun) Words or images assembled for a communicative purpose within a bounded physical medium–typically on sheets of paper or in digital memory files. (2)(verb) To record communications, events, actions, or circumstances within a bounded physical medium. (August 2007) DRAWINGS, PLANS - The drawings, plans or reproductions thereof, which show location, character, dimensions, and details of the work to be performed and which are referred to in the contract documents. (November 1990) DRIVING RELATIONSHIP - A relationship between two activities in which the start or completion of the predecessor activity determines the early dates for the successor activity with multiple predecessors. See also: FREE FLOAT. (June 2007) DRIVING ACTIVITY - The predecessor activity(ies) that determines another activity's early start. (June 2007) DUMMY ACTIVITY - Used only in activity on arrow (AOA) networks to create logic relationships between activities denoting a dependency, but not an action. Dummies are “activities” with zero duration, but are not milestones. Dummy activities are typically drawn as dotted lines. (June 2007) DUMMY START ACTIVITY - An activity entered into the network for the sole purpose of creating a single start for the network. (November 1990) DURABLE GOODS - Generally, any producer or consumer goods whose continuous serviceability is likely to exceed three years (e.g., trucks, furniture). (November 1990) DURATION - The amount of time estimated to complete an activity in the time scale used in the schedule (hours, days, weeks, etc.). Planned production rates and available resources will define the duration used in a given schedule. The following four types of duration are used: 1) Original duration: Duration input by the planner; 2) Current duration: Duration based on latest progress date for in-progress activities. Calculated rate of progress provides a new completion estimate; 3) Actual duration: Duration based on activity's actual start and actual finish. Applies only to completed activities; and 4) Remaining duration: The expected time required to complete an activity. It is calculated as the difference between the data date and the expected finish date for in-progress activities. (Equal to the original duration for non-progressed activities. Equal to zero for completed activities.) See also: ACTIVITY DURATION; CYCLE TIME. (June 2007) DURATION COMPRESSION - Shortening project schedule without reducing project scope. Duration compression is not always possible and often requires an increase in project cost. See also: CRASHING; FAST-TRACK(ING). (August 2007) DURATION SENSITIVITY - the measure of the correlation between the duration of a task and the duration of a project. When combined with the criticality index, it determines the cruciality index. (December 2011) DYNAMIC RISK - Risk for which the characteristics, probability and/or impact change over time or with the occurrence of preceding events. See also: STATIC RISK. (December 2011) DYNAMIC RISK ANALYSIS - Risk analysis which addresses dynamic risks. May employ elements of systems dynamics. See also: SYSTEMS DYNAMICS. (December 2011) EARLIEST EXPECTED COMPLETION DATE - The earliest calendar date on which the completion of an activity work package or summary item occurs. \[4\] (November 1990)