What is Earned Value Management? Video of Earned Value Management Terms & DefinitionsĮarned Value, SPI and CPI Calculations Variances In our example, work performed so far is 40% of total work and so Earned Value is (40% * 1000) = 400. So, in order to have measures that truly reflect the progress made compared to plan, we introduce a term called ‘ Earned Value’ to calculate the value of work performed so far. However, the work completed is only 40% compared to planned 50% and we are behind schedule. The actual cost is less than planned and it may appear that we are under budget. Now, if we want to assess how our project has gone so far, how would we do? Purely comparing the cost (actual 400 vs planned 500) would not give us the true picture. According to our original plan (assuming work is uniformly distributed over time), we should have completed 50% of the project by now and it should have cost us 500. Then, we start the project.Īfter 5 days, let’s say it has cost us 400 and we have completed 40% of the work. Before we begin the project, we estimate that it will take 10 days to complete painting and it will cost 1000. Let’s take a simple project of painting our home.
RESOURCE PLANNING TEMPLATE EXCEL MICROSOFT TUTORIAL FREE FREE
In this article, we will cover the basics of EVM, why it is useful and also a free Excel template which will help calculate the metrics for us. Earned Value Management – Free Excel TemplateĮarned Value Management (EVM) is a technique ( Wikipedia) used in project management to measure progress of a project with respect to cost.
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