Earned Value Management (EVM) combines scope, schedule and cost information so that you can compare the project plan with the work actually achieved.
The three questions EVM helps you answer
Once these values are known, the game can calculate performance indicators and forecasts. CPI compares earned value with actual cost. SPI compares earned value with planned value. Variances show the size of the difference, while EAC, ETC, VAC and TCPI help you look forward.
The project runs for 12 weeks with 360 planned tasks. The baseline plans 30 tasks per week. The BAC is US$54,000 and the planned value increases by US$4,500 each week.
Think of EVM as a conversation between three numbers
Cost alone cannot tell you whether a project is performing well. Spending US$20,000 may be reasonable or concerning depending on how much work should have been completed and how much value has actually been earned. EVM puts those numbers together.
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