How do you monitor and control your project performance with EVM?

1 What is EVM and why is it useful?

EVM is a method that integrates the three main dimensions of a project: scope, time, and cost. It compares the planned value (PV), or the budgeted cost of work scheduled, with the earned value (EV), or the budgeted cost of work performed, and the actual cost (AC), or the actual cost of work performed. By doing so, it calculates key performance indicators, such as cost variance (CV), schedule variance (SV), cost performance index (CPI), and schedule performance index (SPI), that show how well the project is meeting its objectives and expectations. EVM is useful because it provides a clear and objective picture of the project performance, enables early detection and correction of issues, and supports effective decision making and communication.

2 How to plan and implement EVM for your project?

To use EVM for your project, you need to follow some steps to plan and implement it. First, you need to define the scope and deliverables of your project and break them down into manageable work packages. Then, you need to assign a budget and a schedule to each work package and establish a baseline plan that represents the approved scope, time, and cost of your project. Next, you need to measure the EV, or the value of the work completed, for each work package at regular intervals, such as weekly or monthly. You also need to record the AC, or the actual cost incurred, for each work package. Finally, you need to compare the EV and AC with the PV, or the planned value of the work scheduled, and calculate the performance indicators and variances.

3 How to interpret and analyze EVM data?

Interpreting and analyzing EVM data is an essential step for understanding the current and future performance of your project. You can use formulas such as CV = EV - AC to determine whether your project is under budget or over budget, and SV = EV - PV to determine if it's ahead of schedule or behind schedule. Additionally, CPI = EV / AC and SPI = EV / PV can be used to measure how efficiently resources are being used and how quickly the project is progressing compared to the plan. You can also use the data to forecast the future performance of your project, such as Estimate at Completion (EAC), Estimate to Complete (ETC), Variance at Completion (VAC), and To Complete Performance Index (TCPI). For instance, EAC can be calculated as BAC / CPI if the current CPI remains constant, AC + BAC - EV if the original budget is still valid, or AC + (BAC - EV) / (CPI * SPI) if both cost and schedule performance are taken into account. Similarly, ETC can be determined as either EAC - AC or (BAC - EV) / CPI, while VAC is calculated as BAC - EAC, and TCPI as either (BAC - EV) / (BAC - AC) or (BAC - EV) / (EAC - AC).

4 How to use EVM for project monitoring and control?

EVM is not only a tool for measuring and reporting project performance, but also a tool for monitoring and controlling it. You can use EVM to identify and analyze the causes and impacts of variances and deviations from the baseline plan, evaluate the trends of performance indicators over time, communicate project status to stakeholders using charts and graphs, adjust the project plan and budget as needed, implement corrective and preventive actions to address issues, and review the EVM data regularly. This will help ensure accuracy in reporting and controlling project performance.

5 What are the benefits and challenges of EVM?

EVM has many benefits for project management, such as providing a comprehensive and consistent view of the project performance, enabling early detection and correction of problems, and supporting effective decision making and communication. It also improves the accountability and transparency of the process, as well as enhances the quality and efficiency of the project delivery. However, EVM also has some challenges and limitations. It requires a clear definition of the project scope and deliverables, depends on the accuracy of the baseline plan and EVM data, may not capture qualitative aspects or intangible benefits, may not account for external factors or uncertainties, and may not be suitable or feasible for certain types of projects or environments.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?