Analysis of Projection Assumptions
In simple terms, Projection Assumptions are the parameters which determine at what points in time a strategy task is forecast, and how much it is estimated to cost per occurrence. These parameters are stored in the Scheduling and Job Details tabs when editing strategy tasks.
The Strategy module contains functionality which helps you validate the accuracy of these parameters, by checking whether the assumptions and estimations are reasonable. Strategy Task Analyser is the key function in this area (Strategy Optimisation > Analysis of Projection Assumptions.
Using Strategy Task Analyser you can evaluate the strategy task assumptions against actual history. An important acronym to understand on the Strategy Task Analyserreport is ACI, which means Annualised Cost Impact. Annualised Cost Impact quantifies how the strategy task assumptions differ from actual historical performance. This is used to prioritise the review of the strategy task assumptions.
Negative ACI numbers reflect a predicted negative impact on future costs, due to disconnect between actual performances to data based on actual work orders, and estimated performance in the future, based on strategy tasks projection assumptions. In other words, if current performance to date does not align to the expected performance (based on strategy tasks parameters) then there is a disconnection. ACI extrapolates that disconnect in the future, and is reflected by negative costs.
For example, a engine's life is estimated to be 15,000 hours and costs $100,000 to replace. History shows the engine has an average life of 8,000 hours and costs $150,000 to replace, so you are replacing the engine more regularly and at a higher cost than originally estimated. This scenario would be reflected with a negative ACI amount.
Columns on the Strategy Task Analyser report are described below.
| ACI Field | Description |
|---|---|
| UOM | Unit of measure of the strategy task. |
| Actual Occs | Number of actual occurrences of the strategy task based on the work order settlement history linked to the strategy task (it does not include occurrences of a Parent strategy task if the strategy task is part of a suppression or suppression advanced scheduling group). |
| Capex | Identifies the strategy task as a Capital (Capex) or Operating (Opex) expense. |
| SJ | Indicates whether the strategy task is linked to a standard job. |
| SD |
Scheduling Details. Indicates whether the strategy task has advanced scheduling applied, and if so, is the strategy task a Parent or Child in the scheduling group. This is an indicator only. Calculations within the grid (such as average actual frequency, average actual cost and so on) are not impacted by this relationship, which is standard for AMT reports. M = Multiple combinations of Suppression or Dependency in use. |
| ACI Frequency |
The additional cost (if a negative number) over and above the current forecasted cost of the strategy task if the Actual Average Frequency were to be the basis for the strategy task's estimated life in the future. In other words, if you changed the Frequency parameter of the strategy task to equal the Actual Average Frequency, then the projected future cost of the strategy task would increase by the ACI Frequency value. This statistic is based on the work order settlement history linked to the strategy task. |
| ACI Cost | The additional cost (if a negative number) over and above the current forecasted cost of the strategy task IF Actual Average Cost were to be the basis for strategy task's estimated job cost in the future. |
| ACI Total | Combined impact of ACI Cost and ACI Frequency (that is, ACI Cost + ACI Frequency = ACI Total) on future costs. |
| ALI Labour | The additional labour hours (if a negative number) over and above the current forecasted labour hours of the strategy task IF the Actual Average Labour Hours were to be the basis for the strategy task's estimated labour hours in the future. |
| ALI Total | Combined impact of Frequency and Labour (that is amount of additional labour hours in the future based on Actual Average Frequency and Actual Average Labour Hours). |
| ALI Duration | The additional duration (if a negative number) over and above the current forecasted duration of the strategy task IF the Actual Average Duration were to be the basis for the strategy task's estimated duration in the future. |
| ADI Total | Combined impact of Frequency and Duration (that is, the amount of additional labour hours in the future based on Actual Average Frequency and Actual Average Duration). |
| Proj vs Actual / UOM Variance | Variance per UOM of the existing Project Amount vs the hypothetical Projected Amount based on Actual Averages. |