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© PMIS Consulting Limited: all rights reserved
• Objective of this presentation:
– to provide a 10 minute
walkthrough of E...
© PMIS Consulting Limited: all rights reserved
• Before we begin - a
word on EV Methods:
– We do so using one of
many poss...
© PMIS Consulting Limited: all rights reserved
• So, on its own, what
is the chart here
showing us?
– Not much really, all...
© PMIS Consulting Limited: all rights reserved
• So, how is the data
shown here developed?
– The ‘planned spend’,
(aka ‘EV...
© PMIS Consulting Limited: all rights reserved
• Now we have to
calculate and apply EV
(Earned Value), itself.
– At its mo...
© PMIS Consulting Limited: all rights reserved
• So, if we added up
the budgets of all the
tasks that are 100%
complete at...
© PMIS Consulting Limited: all rights reserved
• If we need to, we could
calculate the planned
spend in exactly the
same w...
© PMIS Consulting Limited: all rights reserved
• We can now see two
things:
– We are very much
behind schedule, EV is
less...
© PMIS Consulting Limited: all rights reserved
• Please feel free to
share this
presentation or embed
this presentation in...
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Earned Value Management (EVM) Worked Example - simple to follow :)

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This presentation provides a simple to follow overview and worked example of Earned Value Management (EVM), in storyboard format. Produced by PMIS Consulting in the UK.

Published in: Leadership & Management
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Earned Value Management (EVM) Worked Example - simple to follow :)

  1. 1. © PMIS Consulting Limited: all rights reserved • Objective of this presentation: – to provide a 10 minute walkthrough of EVM, giving a basic understanding of the concept and its three core data items: • Planned spend • Actual Costs • Earned Value – which is easy to follow and understand  • It is not designed to give you in-depth guidance on: – EV analysis – Development of the EV baseline – The vast array of ways that you can use to calculate EV itself (many of which we would recommend to avoid anyway) Earned Value Worked (EVM) Example pmis-consulting.com
  2. 2. © PMIS Consulting Limited: all rights reserved • Before we begin - a word on EV Methods: – We do so using one of many possible methods of calculating EV that we prefer – we prefer to keep away from subjective methods, as history proves they provide unreliable results. Earned Value Worked (EVM) Example Planned Spend (£/$) Actual Cost of work done to date What is this saying? Expenditure variance? Time £/$ 40 K 15 K 25 K 20 K pmis-consulting.com
  3. 3. © PMIS Consulting Limited: all rights reserved • So, on its own, what is the chart here showing us? – Not much really, all it is showing us is planned-v-actual spend. – Some might think this is useful, but in fact it can be misleading or even worse, as we will see later, when EV is added. Earned Value Worked (EVM) Example Planned Spend (£/$) Actual Cost of work done to date What is this saying? Expenditure variance? Time £/$ 40 K 15 K 25 K 20 K pmis-consulting.com
  4. 4. © PMIS Consulting Limited: all rights reserved • So, how is the data shown here developed? – The ‘planned spend’, (aka ‘EVM Baseline’) is the way you expect to spend all resources (inc. purchases), over whole life of the project, expressed as a cumulative (£/$) value. – The green is actual spend (cost) to date Earned Value Worked (EVM) Example Planned Spend (£/$) Actual Cost of work done to date How do we develop these? Time £/$ 40 K 15 K 25 K 20 K pmis-consulting.com
  5. 5. © PMIS Consulting Limited: all rights reserved • Now we have to calculate and apply EV (Earned Value), itself. – At its most simple, EV is the budget value of work performed to date. – In other words, if the budget for a task =100, and it is complete, this contributes 100 towards the EV calculation. Earned Value Worked (EVM) Example Planned Spend (£/$) Actual Cost of work done to date What do we need now? Time £/$ 40 K 15 K 25 K 20 K pmis-consulting.com
  6. 6. © PMIS Consulting Limited: all rights reserved • So, if we added up the budgets of all the tasks that are 100% complete at this time, we have calculated EV (excluding purchases) • And we might find this !!! • And you say aha, what about work in progress? There are ways of dealing with this  Earned Value Worked (EVM) Example Planned Spend (£/$) Actual Cost of work done to date What do we need now? Time £/$ 40 K 15 K 25 K 20 K Earned Value pmis-consulting.com
  7. 7. © PMIS Consulting Limited: all rights reserved • If we need to, we could calculate the planned spend in exactly the same way we will earn EV – We could also apply actual costs for only completed tasks, subject to the agility of our business systems – Giving us a ‘perfect’ EV system – sadly far too many are fundamentally flawed Earned Value Worked (EVM) Example Planned Spend (£/$) Actual Cost of work done to date What do we need now? Time £/$ 40 K 15 K 25 K 20 K Earned Value pmis-consulting.com
  8. 8. © PMIS Consulting Limited: all rights reserved • We can now see two things: – We are very much behind schedule, EV is less than half of Planned spend, and – We are very much over budget, very roughly by a factor of 90%, actual cost is far in excess of budget. • So, what do we use this for? – being totally serious, making sure we never reach this situation Earned Value Worked (EVM) Example Planned Spend (£/$) Actual Cost of work done to date What is this now showing us? Time £/$ 40 K 15 K 25 K 20 K Earned Value pmis-consulting.com
  9. 9. © PMIS Consulting Limited: all rights reserved • Please feel free to share this presentation or embed this presentation in your website and respect our Copyright at all times. • Thank you ! • Please click on the link below to check out our website for more information on this topic. Thank you Planned Spend (£/$) Actual Cost of work done to date What is this showing? Time £/$ 40 K 15 K 25 K 20 K Earned Value http://pmis-consulting.com/articles/earned-value-management/

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