Earned Value Management System (EVM)

Studies have found that 80% of projects fail behind schedule and/or fail to meet stated objectives. Government agencies are increasingly looking to earned value management (EVM) as a means to ensure projects stay on budget and on schedule. In many cases, you can't work for an agency without a certified system in place. If you are looking to expand your presence in the federal arena, you need to practice EVM.

The goal of EVM is to manage scope, cost, schedule, and technical performance as objectively as possible, with an eye toward making sure that the project stays focused, on schedule, on budget, and achieves targeted technical goals. The operative word here is the adverb "objectively": measurement must be in discrete units and performed at the actual level work is performed. The DoD originally developed the core technique over 40 years ago. In the last two decades, it has been expanded upon and implemented through what is referred to as an earned value management system, or EVMS.

Some confusion exists concerning what exactly an earned value management "system" is. There are single integrated software packages on the market that perform EVM. If you want to do it on your own, you can also combine a number of standard software tools, such as Microsoft Project and Excel, along with an accounting system and time reporting system. Whichever the case, your system must be able to:

  • Plan all scopes of work for the program to their completion
  • Use work breakdown structure (WBS) concepts to decompose the work scope into definable pieces assigned to an organizational unit
  • Integrate scope of work, schedule, and budget into a baseline plan
  • Measure accomplishment at the level work is performed using a predefined unit of measurement
  • Analyze significant variances in cost, schedule, and performance from the plan and forecast possible impacts and risks
  • Produce Earned Value reports and analysis data

In sum, EVMS is far and away the most effective means you will have for monitoring and forecasting project performance, both in terms of timeliness (schedule), cost, and work relevancy (adhering to the WBS).

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