This document discusses earned value management (EVM) and added value analysis for construction projects. It explains that EVM provides accurate data on a project's status and progress by answering questions about schedule, budget, deviations, trends, and final costs. EVM involves comparing the predicted value, actual costs, and added value curves over time to analyze performance. By jointly analyzing all three values, important insights can be gained about whether the project is on schedule and on budget. Graphing the curves together clearly shows deviations and the overall project picture.

1. EVM EARNED VALUE MANAGEMENT
ADDED VALUE ANALYSIS FOR PROJECTS
IN THE BUILDING SECTOR
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2. THIS TECHNIQUE IS EXTREMELLY USEFUL FOR THE ORGANIZATION, SINCE IT PROVIDES A
SNAPSHOT WITH ACCURATE DATA ON THE PROJECT’S STATUS AND PROGRESS.
IT PROVIDES ANSWERS TO THE FOLLOWING QUESTIONS:
- ARE WE WITHIN SCHEDULE?
- ARE WE WITHIN BUDGET?
- WHAT ARE THE DEVIATIONS?
- WHAT IS THE OVERALL TREND OF DEVIATIONS UP TO A GIVEN DATE?
- WHEN WILL WE FINISH?
- WHAT WILL BE THE FINAL COST?
- HOW CAN WE ACHIEVE TREND CONTROL?
IN ORDER TO ANSWER SAID QUESTIONS, WE NEED TO GO THROUGH A FEW STEPS OF
PROJECT ADVANCEMENT PLANNING AND MONITORING.
FOR STARTERS, WE WILL TAKE A LOOK ON THE COST BASELINE, WHICH HAPPENS TO
BEHAVE IN ACCORDANCE TO AN “S” CURVE.
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3. Cost baseline – Predicted Value “VP”.
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4. NEXT WE ANALYZE THE BEHAVIOR OF ACTUAL INCURRED EXPENSES ALONG PROJECT EXECUTION.
Actual Expenses– Actual Costs “CR”
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5. THIS DEVIATION CANNOT BE INTERPRETED WITHOUT THE AID OF A PREVIOUS ADDED VALUE ANALYSIS,
WHICH CONSISTS IN ASSESSING TOTAL VALUE OF EVERY SINGLE SERVICE PERFORMED UP TO THE POINT IN
TIME WHEN ASSESSMENT IS TO BE PERFORMED.
I.E....
IF THE PREDICTED VALUE (VP) UP TO A GIVEN MOMENT IS WORTH R$ 1,000,000.
AND ACTUAL COSTS (CR) FOR THE SAME MOMENT IN TIME ADD UP TO R$ 1,065,000.
IT IS STILL NECESSARY TO ASSESS ADDED VALUE (VA) IN ORDER TO ANSWER TO THE QUESTION: ARE WE
WITHIN SCHEDULE? ARE WE WITHIN BUDGET?
LET US PROCEED...
CONSTRUTORA IBEN LTDA.

6. (VP) R$ 1,000,000.
(CR) R$ 1,065,000.
AND
(VA) R$ 1,065,000.
DESCRIBED ABOVE SCENARIO AMOUNTS TO STATING THAT THE PROJECT COSTS EXACTLY
WHAT IT SHOULD COST, SINCE VA = CR, AND THE PROJECT IS 6.5% AHEAD OF SCHEDULE.
IN OTHER WORDS, WE WOULD HAVE COST PERFORMANCE INDEX (IDC) = 1.000 AND DEADLINE
PERFORMANCE INDEX (IDP) = 1.065.
IN ANOTHER EXAMPLE
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7. (VP) R$ 1.000,000.
(CR) R$ 900,000.
A HASTY ANALYST WOULD SAY THAT “WE SAVED 10%.”
HOWEVER, HOW MUCH DID WE ACTUALLY AGGREGATE IN TERMS OF VALUE?
(VA) R$ 800,000, R$ 900,000, R$ 1.000,000?
ONLY A JOINT ANALYSIS OF ALL THREE VALUES IS CONCLUSIVE AND THE GRAPHIC
REPRESENTATION HELPS IN THE QUICK VISUALIZATION OF THE COMPLET PICTURE OF THE
PROJECT.
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8. ANALYSIS OF “S” CURVE EVM AGGREGATE VALUE
Despesas Reais – Custo Real CR.
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9. ANALYSIS OF “S” CURVE EVM AGGREGATE VALUE
DESPITE CR BEING HIGHER THAN VP
Despesas Reais – Custo Real CR.
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10. ANALYSIS OF “S” CURVE EVM AGGREGATE VALUE
Apesar do CR ser maior que o VP
VA IS HIGHER THAN CR,
Despesas Reais – Custo Real CR.
IN WHICH CASE COST
SAVINGS OCCURRED
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11. ANALYSIS OF “S” CURVE EVM AGGREGATE VALUE
Apesar do CR ser maior que o VP
AND VA IS HIGHER THAN VP,
MEANING THAT THE PROJECT ISCusto Real CR.
Despesas Reais –
AHEAD OF SCHEDULE
CONSTRUTORA IBEN LTDA.

12. WRITTEN BY
EDUARDO MILITÃO ELIAS, MBA / PMP®
ID 1396759
SPONSORED BY
CONSTRUTORA IBEN LTDA., RCP PMI®
ID 1463462
CONSTRUTORA IBEN LTDA.