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Earned Value Demystified

What is Earned Value Analysis?

žEV is KPIs that measure the Cost and Schedule performance of a project. žIt’s like a traffic light (green, orange and red), but better.
Here are the main blocks of the EV calculations:

Earned_Value_1

So What?

Earned value indicators that are variances or ratios can help you determine if there is enough money left in the budget and if the project will finish on time.

We Want +/0 Variance and >=1 Indicators

Earned_Value_2

Earned Value Little Story

Earned_Value_3

Earned_Value_2

EV = $50

 

CV = $50 – $100 = -$50

CPI = $50 / $100 = 0.5

 

SV = $50 – $70 = -$25

SPI = $50 / $75 = 0.67

 

To View Earned Value in Microsoft Project

  1. žClick on View tab
  2. žIn the ‘Data’ section click on Tables
  3. žChoose ‘More Tables’
  4. žChoose one of the Earned Value Tables:
    –  Earned Value
    –  Earned Value Cost Indicator
    –  Earned Value Schedule Indicator
  5. Hit ‘Apply’

Earned_Value_5

Written by Laith Adel

Laith Adel, Laith is Principal Consultant of EPM Partners in Australia. Laith has a strong background in Engineering, Project Management and Information Technology.  Laith has worked with the Microsoft Enterprise Project Management (EPM) solution, since its early versions, and participated in many of the largest EPM implementations across the world. Laith is also the chapter leader of the Microsoft Project Users Group (MPUG) in Sydney.

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1 Comment
  1. Laith – this is a nice and simple scenario for the initial ‘Earned Value’ discussion. Nice job. MPUG/Laith – there is a update on the SV calculation… It should be SV = $50 – $75 = -$25.

    You had ‘$70’ for BCWS — SV = $50 – $70 = -$25

    Great job. I’ll be referencing this article in the future.

    Reply

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