EVM: Garbage In, Garbage Out

Andy Jordan is President of Roffensian Consulting S.A., a Roatan, Honduras-based management consulting firm with a comprehensive project management practice. Andy always appreciates feedback and discussion on the issues raised in his articles and can be reached at [email protected]. Andy's new book Risk Management for Project Driven Organizations is now available.

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Topics: Cost Management, Earned Value Management, Scheduling, Strategy

There have been a few occasions where I have been asked to look at projects that appear to be failing badly. Earned value calculations show that the project is seriously behind schedule and over budget, and based on those numbers I have been asked to take a look and recommend some actions that will help the project recover. In some cases I have been able to do that, but in others the problem wasn’t with the project execution--it was with the planning or tracking.

If you are going to rely on EVM numbers to determine where your project is relative to schedule and budget, then you need accurate information on what is really happening as well as accurate information on what should be happening. I don’t want to turn this into an article on the need for good planning and tracking in general; rather I want to look at the specific planning and tracking requirements for earned value management--and the aspects that a project manager has to consider in preparing and managing their project for EVM.

Planning from the EVM perspective
Let’s start with the basics of EVM--the need to identify budgeted cost/planned value from a task perspective. The basic premise of EVM is that we can assign a value to each task--each bar in the Gantt chart, if you like. We can then determine the progress that we have made on our project relative to schedule by comparing the …

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