Earned Value Management (EVM)
Earned Value Management (EVM) is possibly one of the most productive techniques to measure the performance of a project. A project manager always follows a plan-do-check-act management cycle to ensure all the measures of the project. That’s where earned value management helps the project managers to conclude the plan-do-check-act management cycle.
EVM allows the project manager to find that all the tasks of the project are going on according to the schedule or not, whether the problems occurring are critical or not. EVM not only helps in recognizing the problems but also provides the approach that is needed to take the project back on track.
Key practices of EVM include :
- Establish a Performance Measurement Baseline (PMB) –
The most prominent baseline used for measuring the project is the PMB. The PMB is a measure that the project manager uses to verify against certain benchmarks to get to know where the project currently is. Performance Measurement Baseline (PMB) is based on three factors cost, time, and scope. Under the baseline, the work is divided into an achievable level and a time budget is created for each task to maintain the integrity of PMB throughout the project.
- Evaluate performance against the baseline –
After establishing PMB, it also becomes crucial to evaluate and analyze the project performance against the baseline. To evaluate performance, the project manager tracks the usage of resources, physical work progress, calculates the cost per schedule performance, and finds out the concerns in a project to perform the required action during project implementation.
Problems due to the absence of Baseline :
- Monitoring of Progress Problem –
Monitoring means that we can compare the project’s progress with a plan. In actuality, the baseline is used to compare the actual work with the planned work so that we can evaluate the progress of a project. For Ex- If a project is planned to be completed in 3 months with a cost of $1000 and after a month the project manager realizes that it is not possible to complete the project with such cost and time, he/she can take the required actions for it.
- Delays in schedule –
If things are not pre-planned and baselined on how much time the project needs then the project would be delayed. For Ex- If a project should be completed in 3 months and it is being started without any baseline or schedule, no-one knows how long it would take to complete.
- Lack of planning of resources –
If a project didn’t baseline on cost, schedule, and scope, there will be issues in the planning of sufficient resources that are required for the project’s completion.