In Part 5 of our series about the Project Management Tool VNCproject we introduce the module EVM – Earned Value Management.
Each project manager or controller regularly raises the following questions during a project:
How much over / under budget are we (Cost Variance)? And are we ahead or behind of schedule (Schedule Variance)?
For those questions our EVM – Earned Value Management offers accurate answers at any time during your project.
The key features of EVM as part of VNCproject are:
The Earned Value Management (EVM) is designed for the evaluation of progress, so it can identify and assess the actually achieved progress of a project in relation to the planned target. The overall performance within a project in terms of cost and schedule can be measured, as well as technical terms, which are necessary in a project or to complete a task. Our EVM module offers detailed information on the schedule, the technical milestones and the costs already incurred.
And last but not least, of course it gives a fast overview about expected profit and real profit at the actual date.
By using EVM, the following questions can be answered objectively:
- What was the situation at the time X or at the beginning of the project?
- What is the current situation?
- Which results can be expected?
To answer these questions, we work with three data sources:
- The budget or planned value of work scheduled
- The actual value of work completed (AC, actual cost).
- The “earned value” of the work completed (EV, earned value).
The earned value can be compared to the actual costs and the estimated costs to determine variance and predict the future performance within the project.
Benefits of EVM as a part of VNCproject for your own project management:
- EVM is a project management and controlling system that provides reliable data.
- Using WBS (Work Breakdown Structure), your project is completely divided into hierarchical levels and into work packages.
- You will have the opportunity to determine the value of the work already done and the costs incurred at any time during the project course.
- EVM includes reports and charts to illustrate key values clearly.
- It includes a database of your completed projects for comparative analysis.
- You can use the cumulative cost, budget variance or schedule variance as an early warning signal.
- EVM offers an index-based method to estimate the final cost of a project and thereby reduces information overload for the management.
By using VNCproject and our EVM module you can identify and assess the planned target for ongoing projects and the actual progress in proportion. Main factors for evaluation are planned value, actual costs and earned value. In case there is a risk that planned cost or estimated time will be exceeded, project managers, controllers and management can take countermeasures in time.