Project Management

Earned Value and the Drucker Challenge

Garry L. Booker, PMP, CSM, is a contract project manager and Agile Lead. He lives in Tulsa, Oklahoma.

In the near future, earned value management will help meet Drucker's Challenge — that is, by measuring the true productivity of knowledge workers. This EVM renaissance will emphasize real-time and lead measures over current lagging measures, and EVM-based graphics will gradually displace Gantt charts and other common display methods.

The late Peter Drucker explained the challenge of knowledge worker productivity clearly in 1991. In the Industrial Age, it was relatively easy to measure productivity. Industrial productivity was (and is) the value of output divided by the cost of input. Measuring productivity in the Knowledge Age is Drucker’s Challenge; it is not so simple. This is because every knowledge worker chooses outputs (planned outcomes) and inputs (daily actions) as knowledge work unfolds. Knowledge workers are like travelers who choose their own destinations, and also decide how to get there. The challenge is magnified in virtual team environments, because interpersonal awareness is even more difficult.
So, how do we measure knowledge worker productivity? It turns out that an insightful answer to that question began to take shape in the U.S. Department of Defense at about the same time that Drucker coined the term “knowledge worker.” Unfortunately, the answer was quickly buried in an avalanche of acronyms, formulas and jargon. It is called Earned Value Management…

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"If you would be a real seeker after truth, it is necessary that at least once in your life you doubt, as far as possible, all things."

- Rene Descartes