ABSTRACT
This chapter discusses the principles of Earned Value Method (EVM) and some common pitfalls. The primary aim of EVM is to use a consistent method of project progress measurement based on the actual work completed. EVM methods can be categorized as either descriptive or predictive. Descriptive EVM methods use past project performance to report how well the project is performing. Predictive EVM uses past performance to forecast the future performance of a project. Three parameters are used in EVM forecasting: cost, time, and the cost performance required to meet a target project cost. Plotting project cost and time data for multiple work packages on a graph is useful since it shows how the EVM variables behave over time. Successful EVM is only possible if a project is specifically planned to use EVM. Effective EVM requires complete definition of the scope of work. The Work Breakdown Structure (WBS) is a major input for the development of project cost and time estimates.
