Earned Value Management Formulas...Illustrated

David Rico, PMP, is an IT project manager at CompuCom Systems serving clients in the healthcare, automotive, and financial industries. He specializes in IT security, integrations, and process engineering projects.

  Cost Management   Earned Value Management   Estimating   Using PMI Standards   Knowledge Shelf  

Did you ever find yourself in a lost state, and you know how you would get there… if only you had a map and a compass?

I found myself in the above predicament while studying intensely for the Project Management Professional (PMP)^® certification exam.

The intent of this article is to explain how I found my true North in the understanding of Earned Value Management formulas. It was a pivotal moment to change my thinking from formula memorization to full comprehension, and I was able to do so through visualizing it.

In comparison, I would equate it to the difference of a meteorologist audibly describing an approaching storm—describing wind speed, direction, temperature, latitude/longitude coordinates, etcetera. Compare that to a Meteorologist using satellite weather maps as a visual aid. For me, seeing it in motion instantly makes much more sense.          

The Bright Light Bulb Moment
During my studies for the PMP exam, I have to admit, I struggled with the Project Cost Management Knowledge Area of A Guide to the Project Management Body of Knowledge (PMBOK^® Guide), and was overwhelmed with over 16 EVM formulas to commit to memory.

I read several books and articles on the subject and generally understood the text book explanations. However, there was one illustration from “…

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