Earned value analysis is a project management technique that compares the planned value of work scheduled to the actual cost of work performed and work earned. It measures project performance and progress in three dimensions: planned value, earned value, and actual cost. Planned value defines the work that should have been completed, earned value is the budget associated with work actually completed, and actual cost is the total cost incurred so far. Variance analysis using metrics like the cost performance index, schedule performance index, cost variance, and schedule variance allows evaluation of how a project's performance compares to its plan.

1. Project Management
Key Concepts

2. Earned Value Analysis

3. What is it?
Earned value provides a current view on scope,
schedule, and cost performance. It compares the
performance measurement baseline (what was
planned) to the actual schedule and cost
performance.
Earned Value Analysis

4. Earned Value Management develops and
monitors three key dimensions for your project
and work packages:
1. Planned Value
2. Earned Value
3. Actual Cost
You will also need your project budget, “Budget at
Completion” or BAC.
Earned Value Analysis

5. Earned Value Analysis
Planned Value (PV)
It is the authorized budget allocated by phase over the life of
the project, but at a given point in time.
Planned value defines the physical work that should have
been accomplished.
Project budget of $10,000, where 30%
completed, against 40% planned and $5,000
spent so far.
PV = 40% of $10,000
= $4,000

6. Earned Value Analysis
Earned Value (EV)
Is the budget associated with the authorized work that has
been completed. The EV is often used to calculate the
percent complete of a project.
Project budget of $10,000, where 30%
completed, against 40% planned and $5,000
spent so far.
EV = 30% of $10,000
= $3,000

7. Earned Value Analysis
Actual Cost (AC)
Is simply the total cost incurred in accomplishing the work so
far.
Project budget of $10,000, where 30%
completed, against 40% planned and $5,000
spent so far.
AC = $5,000

8. We can then use Variance Analysis to see how our
project is tracking, for example:
• Cost Performance Index
• Schedule Performance Index
• Cost Variance
• Schedule Variance
Earned Value Analysis