EARNED VALUE MANAGEMENT
Earned Value Management is a technique for project monitoring which originated in US Manufacturing but was improved through its use in the Minuteman Missile project.
Since then it has been adopted by the construction industry with great success. Despite this it remains heavily underutilised due to the apparent complexity.
While it can become complex for major schemes it is possible to undertake simplified Earned Value Management for any size project.
Earned Value Management provides and analytical approach to deliver performance metrics which demonstrate the projects performance on programme and on cost. It has been proven to predict the end cost of a project with a certain degree of accuracy as early as 15% into the project. Other methods of project performance measure that measure cost and programme performance separately cannot deliver the same accuracy of performance. Using this analytical approach to performance measurement also removes the interpretation of information which can be manipulated based on opinion of the results.
Performance analysis using Earned Value Management removes any bias in the reporting or project performance. The interpretation of the information has been proven and fine tuned over hundreds of projects (Minor and Major) to perfect the method.
Using the metrics it is then possible to determine with a higher level of certainty than other methods what the projects final cost will be. Earned Value Management will also highlight a problem project much sooner than most other monitoring methods.
Earned Value Management is not a replacement for a programme which is still needed for the process to be undertaken correctly. For more information on Monthly Programmes click the link below:
As part of any Earned Value calculation we will also provide a report detailing the metrics calculated and interpretation of the information including a forecast of project completion date and cost range.
If you would like to discuss how Earned Value Management can improve your projects then contact us.