The Factors Affecting on Earned Value Management (2024)

FAQs

What three factors must you provide earned value management for on this project? ›

Earned value management analysis

To evaluate the situation of the project, you first need to calculate 3 main metrics – Planned Value (PV), Earned Value (EV), and Actual Cost (AC). If you are unsure of how this is done, check out this page about Earned value management.

Earned Value Management (EVM) A methodology that combines scope, schedule and resource measurements to assess project performance and progress.

What is Earned Value Management? Earned value management (EVM) is a project management methodology that integrates schedule, costs, and scope to measure project performance. Based on planned and actual values, EVM predicts the future and enables project managers to adjust accordingly.

The project management triangle is made up of three variables that determine the quality of the project: scope, cost, and time. The triangle demonstrates how these three variables are linked—if one of the variables is changed, the other two must be adjusted in order to keep the triangle connected.

EVM is built on three metrics: Planned value, earned value, and actual cost. Think of these metrics in terms of your project budget and schedule.

You can calculate the EV of a project by multiplying the percentage complete by the total project budget. For example, let's say you're 60% done, and your project budget is $100,000 — your earned value is then $60,000.

All reported changes to the project baseline, management reserve (MR) and contingency should be traceable through the formal Earned Value Management System (EVMS) and CPR reports.

EVM is an essential backbone in project management as it helps project managers determine the health of the project, identify possible risks and liabilities, as well as use data-driven decisions to improve the project performance.

The three pillars for EVM are: scope, budget over time and progress data. From the schedule, you can determine the Planned Value (PV) – the work scheduled to be completed by a specific date - and compare it to Earned Value (EV), the budget for the amount of work completed.

What are the objectives of earned value management? ›

Earned Value Management offers invaluable insights into project performance, cost control, and schedule management. By integrating project scope, schedule, and cost data, EVM allows project managers to assess progress, forecast future performance, and make informed decisions to keep projects on track.

This determination begins with classifying work tasks as one of three types: discrete, apportioned effort, or level of effort (LOE).

COMPONENTS OF AN EVM & VVPAT

The EVM consists of Control Unit (CU) and Ballot Unit (BU) and their connection cables.

The most commonly used rules of credit are; 0/100 – Work is considered as earned (completed) when it is 100% completed. 50/50 – 50% of the work is considered as earned as soon as the work starts. The remaining 50% will be considered as earned only when the remaining 50% is fully completed.

The Actual Cost “AC” is the budget that has been consumed to date. The Planned Value “PV” is the amount of budget that was allocated to be consumed to date. The Earned Value “EV”, is the amount of work the project has completed in reference to the original project budget “BAC”.

Scope, time, and cost are well-known features of the project management triangle and it might seem like an easy task to manage all three factors but in reality, a good project management plan will shape the best solution for moving forward with any project at hand and a lot more thought and planning is involved than ...

The triple constraint theory says that every project will include three constraints: budget/cost, time, and scope. And these constraints are tied to each other.