The document introduces the Earned Value Management Maturity Model (EVM3), which defines five levels of earned value management (EVM) process maturity. Level 1 indicates an initial, ad hoc implementation, while Level 5 represents an optimizing process where improvements are continuously measured and implemented. The EVM3 provides organizations a framework to assess their current EVM process and prioritize improvements to increase maturity.

1. ©MMII Management Technologies
The Earned Value Management Maturity
Model®
(EVM3®)
Ray W. Stratton
Management Technologies
raystratton@mgmt-technologies.com
The Earned Value Management Maturity Model, and EVM3 are
registered trademarks of Management Technologies.
Integrated Project Management Conference
Tysons Corner, Virginia
2002

2. ©MMII Management Technologies
Does This Sound Familiar?
• “Our SPI and CPI looks good, but we know we have
schedule and cost problems”
• “The SPI was 1.0, but we couldn’t ship the product on
time!”
• “I’d like to do Earned Value but I don’t know where to
start.”
• We’re spending a fortune on Earned Value, I just
don’t see an ROI.”
• “Our customer asked if our Earned Value data was
good. I didn’t know what to say.”

3. ©MMII Management Technologies
The Value of a Maturity Model
• A list of tasks to meet industry standards
• A priority of tasks sorted into levels of difficulty
• A roadmap for organizations to use to improve
processes
• A process measurement tool to evaluate current
processes and prioritize improvement efforts

4. ©MMII Management Technologies
Characteristics of Common
Staged Maturity Models
• Level 1 - ad hoc; limited, isolated, random success
• Level 2 – simplified project/team usage
• Level 3 - organization-wide usage and direction
• Level 4 - quantify process performance
• Level 5 - quantitatively improve process

5. ©MMII Management Technologies
The Earned Value Management
Maturity Model®
Monitoring the efforts to improve the
Earned Value Management system
Managing the quality
of the EVM data
ANSI 748 compliant,
organization-wide
Less than fully compliant
with ANSI 748, limited project use
No or limited EVM
implementation in place
Levels provide foundations for continuous improvement of EVMS
Level 4
Managed
Level 1
Initial
Level 2
Localized
Level 5
Optimizing
Level 3
ANSI 748 Compliant

6. ©MMII Management Technologies
Attributes of Level 1 –
INITIAL
• No or limited EVM implementation in place
• A defined starting point for an initial implementation

7. ©MMII Management Technologies
Attributes of Level 2 -
LOCALIZED
• Simplified EVM implementation
• Less than fully compliant with ANSI 748
• May be sufficient for smaller projects
• May meet organizational needs
• Consistent with a modest investment in EVMS
• Provides valuable project insight
• Gets people familiar with Earned Value concepts
• Can help architect a fully integrated Earned Value
system

8. ©MMII Management Technologies
Attributes of Level 3 –
ANSI 748 COMPLIANT(+)
• An ANSI/EIA 748 compliant implementation
• Organizational policy (System Description)
• Organization wide
• EVMS organizational repository
• EVMS training program
• Earned Value Process Group (EVPG)

9. ©MMII Management Technologies
Attributes of Level 4 -
MEASURED
• Introduces metrics for measuring EVMS processes
• Measures the quality of EVM data
Levels 2-3 measure the project execution process
Level 4 measures the Earned Value Management process
• Requires a technical baseline for technical work
• Adjusts Earned Value (BCWP) per a technical
baseline and technical variance

10. ©MMII Management Technologies
Attributes of Level 5 -
OPTIMIZING
• Planning and tracking improvement of the Earned
Value Management System
• Defect prevention is planned
• Defect causes are determined, prioritized,and
reduced

11. ©MMII Management Technologies
Categories within EVM3
• EIA 748 defines five Categories of Earned Value
Guidelines
• Provides the implementation areas for EVM3® Levels
2 and 3
– ORGANIZATION
– PLANNING, SCHEDULING, and BUDGETING
– ACCOUNTING
– ANALYSIS and MANAGEMENT REPORTS
– REVISIONS and DATA MAINTENANCE

12. ©MMII Management Technologies
Level 1 - Characteristics &
Processes
• There are no expectations at this level
• Some individuals may try EVMS
• Management does not encourage its use
• Lack of project planning may preclude meaningful
use of Earned Value

13. ©MMII Management Technologies
Example of the Level 1
Organization
• Earned Value Management is applied by zealots
• Pockets of Earned Value Management deep with
projects
• No project wide roll-up
• Cost and schedule variance discussed in traditional
non-Earned Value terms
• Management is unfamiliar or unsupportive of Earned
Value

14. ©MMII Management Technologies
Level 2 - Characteristics
• Use of a WBS
• Plan and schedule the scope
• Budget cost accounts to functions or products
• Maintain a baseline (i.e., control changes)
• Monitor the project, forecast outcome
from Flemming and Koppleman “Earned Value Project
Management” 1996

15. ©MMII Management Technologies
Level 2 - Processes
• Use of a WBS (2.1a)
• Who does the work
(2.1b)
• Use a time-phased
budget (2.2c)
• Use control accounts
and work packages (2.2
d/e)
• Work packages add to
account budget (2.2f)
• Record costs like
they’re budgeted (2.3a)
• Compute variances (2.4a)
• Analyze variances (2.4b)
• Act upon Earned Value data
(2.4e)
• Maintain baseline, revise as
authorized (2.5a)
• Retain revision history (2.5b)
• No unauthorized baseline
changes (2.5d)
• Document baseline changes
(2.5e)
Parentheses refer to EIA 748 sections

16. ©MMII Management Technologies
Example of the Level 2
Organization
• Management supports limited implementation
• Limited investment (use of Excel vs. commercial
tools)
• Selected projects and management staff are trained
on Earned Value principles
• Earned Value data is used in reporting and decision
making
• Financial system may not be integrated with Earned
Value (use of staff-hours versus dollars)

17. ©MMII Management Technologies
Level 3 - Characteristics &
Processes
• Meets all ANSI/EIA 748 Guidelines…….
– Organization (5)
– Planning, Scheduling, Budgeting (10)
– Accounting (8, including subheadings)
– Analysis and Management Reports (8, includes
subheadings)
– Revisions and Data Maintenance (5)
• EVMS is applied uniformly throughout the
organization via a “Systems Description” or similar
document
• Training program funded
• EVPG exists
• An Earned Value library exists

18. ©MMII Management Technologies
Example of the Level 3
Organization
• All guidelines of ANSI/EIA 748 met
• Employees receive training on Earned Value
principles and its implementation
• System Description approved, issued, used, and a
“change request” process exists
• System Description is tailored by projects, reviewed,
and approved
• EVPG addresses changes and tailoring
• Retention of best practices, lessons learned, past
project data is centralized
• Standardization of Earned Value Management tools

19. ©MMII Management Technologies
Level 4 Characteristics
• Organization has EVMS process metrics
• Notional samples
– Consistency (value of work packages)
– Complexity (WBS fan-out)
– Workload (work packages per CAM, manager, etc.)
– Data latency (days from accounting to reporting)
– Baseline stability (number of replans per ……)
– Value of re-plan (significance to baseline)
– Correctness (number of retroactive accounting changes)
– Sensitivity (when EVMS data first indicated final outcome)
– Percent LOE content

20. ©MMII Management Technologies
Level Of Detail Metric
NUMBER OF COST ACCOUNT
PACKAGES
VALUE
UNDER
REPORTING
OVER
REPORTING
NOMINAL
$
0
.
. .
.
.
.
.
.
NUMBER OF WORK PACKAGES
1-5 6-10 11-15 16-20
GOAL

21. ©MMII Management Technologies
Accuracy and Latency Metric
ADJUSTMENT DELAY (DAYS)
QUANTITY
(NOT VALUE)
30 60 90 120 150 180
BCWP
ACWP

22. ©MMII Management Technologies
Data Latency Metric
REPORT DATE OR NUMBER
LATENCY
(WEEKS)
0
1
2
3
4
WP BCWP
WP ACWP
EV REPORT
1 2 3 4 5 6 7 8 9 10

23. ©MMII Management Technologies
Planning Package Lead Time
Metric
PLANNING PACKAGE DETAIL PLANNING
LEAD TIME (DAYS)
NUMBER OF PLANS
PROMOTED FROM
PLANNING
PACKAGE
30 60 90 120 150 180

24. ©MMII Management Technologies
Level 4 Processes
• Data on EVMS is collected periodically
• Trends are monitored
• Management is advised periodically
– positive and negative trends
– cost of EVMS
– data accuracy
– data latency
– accuracy of EVMS projections
• EVMS Improvement Plans are developed by EVPG

25. ©MMII Management Technologies
Example of the Level 4
Organization
• An EVMS metrics collection effort is underway
• Independent from project Earned Value performance
data
• Periodic reports on the trends of data are provided
• Recommendations for improvement are documented
• Known problem areas are identified

26. ©MMII Management Technologies
Level 5 Characteristics
• Organization has EVMS Improvement Plans in place
• Process engineering is funded to implement
improvements in EVMS
• Improved processes are injected into new projects
• Metrics are collected
• Planned versus achieved improvements are
compared
• Improvement plans are revised as needed
• EVMS process data is continually analyzed for further
improvements

27. ©MMII Management Technologies
Level 5 Processes
• Plans are published for improving their EVMS
• Projects are facilitated in using new procedures
• Budgets and schedule are defined for improvements

28. ©MMII Management Technologies
Example of the Level 5
Organization
• EVMS is under constant improvement
• Improvement are uniquely budgeted and uniquely
staffed (EVPG)
• Earned Value data is made more accurate
• Earned Value data is more timely
• Less and less effort is spent in executing the EVMS
• EVMS historical data is used in estimating new work,
decision analysis parameters, simulations, etc.
• Data is used for project planning

29. ©MMII Management Technologies
Mapping EIA 748 to EVM3®
• ANSI 748 Categories and EVM3 are related
LEVEL 1 2 3 4 5
ORGANIZATION X- X X X
PLANNING, SCHEDULING, BUDGETING X- X X X
ACCOUNTING X- X X X
ANALYSIS AND REPORTING X- X X X
REVISIONS AND DATA MAINTENANCE X- X X X
PROCESS METRICS X X
PROCESS IMPROVEMENT X

30. ©MMII Management Technologies
EVM3 Goes Beyond ANSI 748
• EVMS Training
• Earned Value Process Group (EVPG)
• Earned Value Repository
• Earned Value Process Metrics
• Earned Value Process Improvement

31. ©MMII Management Technologies
The Corporate and
Stockholder Payoff
• Higher EVM3® should be a corporate goal
• Like ISO 9000, raises stockholder and analysts’
perception of company health
• Can increase business
• Can help manage more business with current assets
• Good Earned Value Management data is becoming a
core metric for Wall Street corporate financial
statements regarding future investments and
revenues

32. ©MMII Management Technologies
Next Steps
• EVM3® recognition by industry and government
• Internal EVM3® assessments
– where are we good?
– where are we weak?
– what are our next steps?
• External formal EVM3® evaluations
– independent EVMS process review
– determination of your EVM3 Level?
– contractor or teammate qualification

33. ©MMII Management Technologies
The Goal
• Knowing how mature your organization is in
implementing EVMS
• Knowing how mature your contractors or suppliers
are in EVMS
• Being able to state your EVM3®
Level to your
customers
EVMS measures the health of a project..
….but what is the health of the EVMS?

34. ©MMII Management Technologies
Assessments
• Self assessment
– Use the EVM3 as a checklist
– Deep knowledge of internal practices
– Lack of objectivity or benchmarks
• External Assessment (Recommended)
– Mix of external and internal assessors
– Retains depth of internal practices
– Adds objectivity and benchmark data
– Formalized report and plan of action

35. ©MMII Management Technologies
Obtaining the EVM3®
• It’s free!
• It’s 35 pages
• It’s downloadable (pdf)
– www.mgmt-technologies.com

36. ©MMII Management Technologies
Legal Stuff..
• The Earned Value Management Maturity Model® and the abbreviation EVM3® are
trademarks of Management Technologies and registered in the U.S. Patent and Trademark
Office. Use of the term EVM3 shall refer to this document in its entirety.
• Special permission to use Key Practices of the Capability Maturity Model® for Software,
Version 1.1, CMU/SEI-93-TR-25, and Capability Maturity Model® for Software, Version 1.1,
CMU/SEI-93-TR-24, © 1993 by Carnegie Mellon University in The Earned Value
Management Maturity Model® is granted by the Software Engineering Institute.
• Capability Maturity Model® and CMM® are registered in the U.S. Patent and Trademark
Office.
• Management Technologies owns the exclusive right, title, and interest in and to The Earned
Value Management Maturity Model (EVM3) and any derivative works based upon the EVM3
created by any party.
• CMM, Capability Maturity Model, Capability Maturity Modeling are registered in the U.S.
Patent and Trademark Office. CMMI; CMM Integration are service marks of Carnegie Mellon
University. SW - CMM, SE - CMM, CMMI, P-CMM, and SA - CMM are trademarks and/or
service marks of the Carnegie Mellon University