Question

How is Earned Value Management mutually supportive and how does this highlight areas where scope and earned value will diverge?

Answer 1

Earned Value Management (EVM) is a project management technique for measuring project effectiveness and progress in a targeted way.

Cost management is a project management technique for measuring project output and progress. It has the ability to combine triangles for project management: scope, time and cost.

In a unified system, the value management received is able to provide accurate forecasts of problems with project implementation, which is a key contribution to project management.

Early EVM research has shown that the area of ​​planning and management is strongly influenced by its use. And the use of such methods improves both the definition of scope and the overall efficiency analysis of the project. Recent studies show that EVM principles are a positive predictor of project success. The popularity of EVM has grown in recent years, apart from government contracts, an area in which its importance continues to grow, in part because EVM can also emerge and help show contract disputes.

Key features of EVM implementation include:

A project plan that defines the work to be done
Scheduled Employment Evaluation, called Projected Value (PV) or Planned Cost of Planned Work.
"Defined Earnings Rules" (also known as indicators) for measurement work, called the Earned Value (EV) or Cost of Work Done.

Implementation of EVM for large or complex projects includes many other features, such as cost and cost efficiency indicators (above or below budget) and time. The most basic requirement of an EVM system is that it determines the growth using PV and EV.

Example..

Project A is approved within one year with an X budget. It is also planned that the project will spend 50% of the approved budget and expect 50% of the work to be completed within the first six months. If now, six months after the start of the project, the project manager announces that he has spent 50% of the budget, it can be thought at first that the project was perfect as planned. However, the fact that the information provided is not sufficient to reach such a conclusion. The project can cost 50% of the budget while only completing 25% of the work, meaning the project is not working properly. Or the project can cost 50% of the budget while completing 75% of the work, which means the project works better than planned. EVM is designed to solve similar and similar problems.