Earned Value Management (EVM)

Earned Value Management (EVM) - a project management technique that combines schedule & cost performance and it is about the investment returns in a given project.

It helps to answer the following question: “What did we get for the money we spent?”

Basic concepts of EVM:

• All project steps “earn” value as work is completed.
• The Earned Value (EV) can then be compared to actual costs and planned costs to determine project performance and forecast performance trends.
• Actual physical progress is measured in terms of dollars, hence schedule and cost performance can be analyzed in the same terms.
• Planned Value (PV)- the timephased budget and schedule, incremental plan which gives cost and schedule baseline.

The DOD Australia, DMO website on Performance Management defines the following as such:

• PV - The sum of the budgets for all work effort planned to be accomplished (ie. the plan).
• EV - The sum of the budgets for all work effort actually accomplished.
• Actual Cost (AC) - The actual costs incurred to date.
• Budget At Completion (BAC) - The sum of all budgets allocated to the contract. This does not include the contractor Management Reserve.
• Estimate at Completion (EAC) - Actual costs to date plus an estimate for work remaining.

In the next post, I will talk about the other EVM terms and formulae and how these help in measuring project performance.

One Page Project Manager

The One-Page Project Manager (OPPM) shows you how to boil down any project into a simple, one-page document that can be used to communicate all essential details to upper management, other departments, suppliers, and audiences.

This practical guide will save time and effort, helping you identify the vital parts of a project and communicate those parts and duties to other team members.

The book is concise and gives clear, step-by-step instructions and examples thats easy to follow. Templates are available from the website.

This is a great tool. Get it and try. Click here to read more about the book.

Success, Health, Wealth and Abundance to you always :)