Project managers are expected to know the progress of their projects at all times. Are you meeting expectations? Staying within budget? Staying on schedule? These can be tough questions to answer without the use of EVM (earned value management).
Fortunately, EVM doesn’t require a different approach to project planning and management. Rather, it extracts useful information from planning work that you’re routinely doing.
History of EVM: A Hundred Years of Evolution
Earned value is basic cost accounting applied to the one-time events we call projects.
The practices we now call EVM developed out of cost management techniques used in large factories as early as the 1800s. Industrial engineers of the time compared planned vs. actual output, timing, and cost to provide a picture of performance relative to expectations. Modern EVM does exactly the same thing.
Today, EVM has returned to its roots in cost accounting, but has gone high tech regarding the use of computers and statistical analysis. The new EVM is efficient, effective, and easy to use. It is intended for general use by project managers working on any type of project where senior management wants to be kept informed of project progress, not just the final outcome.
This information was drawn from Global Knowledge’s Earned Value Management course.
This article was originally published in Global Knowledge’s Business Brief e-newsletter. Global Knowledge delivers comprehensive hands-on project management, business process, and professional skills training. Visit our online Knowledge Center at www.globalknowledge.com/business for free white papers, webinars, and more.
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