Determining Measurement Methods in Earned Value Management

 

Reading The Practice Standard for Earned Value might not be everyone’s idea of a fun way to spend the afternoon, but I’ve been really trying to understand how EVM works in practice this year. Today, I’m diving into the Determine Measurement Methods process because it seems – to me, at least – that this is probably the most important part. How do we know what to measure and if we are doing it right?

I think EV management software probably takes a lot of the measurement heavy lifting off the project team, but you still have to know enough about what’s going on under the hood to be able to make intelligent, informed decisions and explain what you’re seeing to other people.

This process is where you choose the right method of performance measurement and progress evaluation for each of your work packages.

Who does this? You, as the project manager, should take an active role in leading on facilitating the process, with input from the control account manager who has the detailed knowledge of what measurements would actually work in practice.

In other words, you can’t be taking these decisions by yourself. As you aren’t the expert in doing the work or tracking the work, it’s someone else who has to tell you what’s reasonable for measurement. You can inform and support this, providing tips and ideas when they don’t know what to say, but ultimately I would prefer to be guided by the expert’s decision once we’ve discussed and agreed.

Inputs

There are five inputs to this process:

• Requirements documentation (paperwork like contract requirements, any technical and business requirements, non-functional requirements and so on)
• Statement of work (this describes the outputs of the project)
• Scope baseline (includes an approved version of the scope statement, WBS and WBS dictionary – basically, the full set of signed off scope docs)
• Integrated Master Schedule (we made this a few processes ago)
• Project budget.

These last two are the most important, in my view. You use the IMS and the budget together to create a phased view of how the money relates to the tasks. That’s the backbone of EV.

What to do

With those inputs on your desk, you’re good to go.

The task to do is to determine how you are going to measure progress for each work package.

There are a number of different ways to measure progress, and you can’t really rate them in order of priority or importance because they all have their pros and cons. It’s most important to choose one that relates closely to the work you are doing and will give you the most appropriate, most accurate way of understanding how the work is going.

Typically, you’ll end up choosing one of these:

• Discrete effort (for tasks with a specific, measurable output)
• Apportioned effort (for tasks that support tasks that can be measured by discrete effort e.g. the project management overhead for a project)
• Level of effort (for tasks where the other types of measurement don’t really work).

You can choose whatever measurement approach works for you, the control account manager and the project, but it needs to be something tangible and documented so everyone can see what ‘progress’ means and how it is tracked. You have to be pretty sure about your approach because changing it halfway through the project when you realised you picked the wrong one is going to mess up your EV reporting.

So how do you decide?

Think about what the work is and what the most appropriate way of measuring it would be. For example, how long is the work going on for? You may choose weekly measurement instead of daily measurement if you’ve got to be tracking over a longer period of time.

How risky is the work? Do you need to be totally on top of it with detailed tracking hourly? For low risk tasks that wouldn’t be appropriate.

If your organisation has guidelines, then use them so projects can be compared.

Outputs

The outputs from this process are:

• Performance measurement methods – no surprise here, you’ve just created them
• Control Account Plan updates.

So what are you doing when you update the control account plans? The documents are created already, and now all you have to do is drop in the performance measurement method that you’ve decided on.

You’ll also want to add in the period over which the progress is tracked, so is that weekly, monthly or some other time period. And what unit you are measuring in: hours, days, money, widgets created or anything else that makes sense for your project.

The point of this project is to come up with ways of tracking progress that are objective, accurate and timely. It sounds hard, but if you think about it, you’ll come up with some ways of measuring that work for you. And if you can’t, perhaps you need to be a little bit more creative or get some expert help in working out how to track – or perhaps EV isn’t appropriate for this project, if there are a lot of tasks that can’t be tracked in an objective way. Because if you can’t track it, you won’t be getting a lot of value out of the EV reporting, which rather defeats the purpose of setting up tracking mechanisms in the first place.

Remember, pick something sensible that works, that the control account manager can work with, and that is documented clearly so everyone knows how progress is being measured. That’s all this process is about. Hopefully, over time and with some experience, this part becomes standard and very easy, as you can lift parts of control account plans from other projects to use on this one.

Next time, I’ll be looking at the next process in the earned value management standard, which is establishing the performance measurement baseline.

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