Earned Value Analysis in Project Management (Essay Sample)

Earned Value Analysis in Project Management
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Earned Value Analysis in Project Management
Earned Value Analysis (EVA) is a general method of measuring the progress of a project at any time during the execution and to foresee when and in how much cost the project is going to complete. As the project proceeds, variances in the budget and schedule can also be analysed by comparing the planned amount of work and the actual cost with which work has been completed. It gives a quantitative data to assess whether or not the project is going in accordance with the plan.
This was first time developed during sixties by Defence Department of NASA to track their programmes and plans. Today this has become a mandatory requirement for many government and private organizations and industries to assess risks in management. EVA counts progress against a baseline and has three key factors for every activity in Work Breakdown Structure (WBS):
* Planned Value (PV) or Budgeted Cost of Work Scheduled (BCWS)
* Actual Cost (AC) or Actual Cost of Work Performed (ACWP)
* Earned Value (EV) or Budget Cost of Work Performed (BCWP)
The mostly used measures are the cost variance and the schedule variance as under: