How do you evaluate the accuracy and reliability of your EVM data and assumptions?
If you are a project manager, you probably use earned value management (EVM) to monitor and control your project cost and schedule performance. EVM is a method that compares the actual work done and the actual costs incurred with the planned work and the planned budget at any point in time. EVM can help you identify variances, forecast future outcomes, and take corrective actions. But how do you know if your EVM data and assumptions are accurate and reliable? Here are some tips to help you evaluate your EVM data and assumptions.
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Oseghale Okohue BEngr. Msc. MBA. DBA. Prince2®PractitionerEngineering Project Manager | EPICM, Oil & Gas, Subsea Engineering, Renewable Energy (Solar, Wind, Hydrogen, Electrical…
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Hassan HendiProject Controls Engineer | Planning & Scheduling | progress Reporting | Dashboard | Delay Analysis | Primavera P6 |…
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wael AtefPlanning&Cost Control Engineer
The foundation of EVM is the work breakdown structure (WBS) and the organizational breakdown structure (OBS). The WBS is a hierarchical decomposition of the project scope into manageable work packages, while the OBS is a hierarchical representation of the project team and their roles and responsibilities. The WBS and OBS should be aligned and integrated to form the control accounts, which are the units of measurement for EVM. You should check your WBS and OBS regularly to ensure that they reflect the current scope, schedule, and resources of your project, and that they are consistent and complete.
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Evaluating the accuracy and reliability of your Earned Value Management (EVM) data and assumptions is crucial in project management. A primary step is regular review of your Work Breakdown Structure (WBS) and Organizational Breakdown Structure (OBS). Both should be updated to reflect the current project scope, schedule, and resources. Regular data quality checks are essential to verify the accuracy of the collected data. Ensure that the data used for EVM calculations is based on reliable and up-to-date information. Finally, validate your EVM assumptions throughout the project lifecycle, adjusting as necessary. Regular audits and reviews can help maintain the accuracy and reliability of your EVM data and assumptions
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Evaluating the accuracy and reliability of your Earned Value Management (EVM) data and assumptions is crucial in project management. A primary step is regular review of your Work Breakdown Structure (WBS) and Organizational Breakdown Structure (OBS). Both should be updated to reflect the current project scope, schedule, and resources. Regular data quality checks are essential to verify the accuracy of the collected data. Ensure that the data used for EVM calculations is based on reliable and up-to-date information. Finally, validate your EVM assumptions throughout the project lifecycle, adjusting as necessary. Regular audits and reviews can help maintain the accuracy and reliability of your EVM data and assumptions.
The three key data elements of EVM are the planned value (PV), the earned value (EV), and the actual cost (AC). The PV is the authorized budget for the work scheduled to be completed by a given date. The EV is the value of the work actually completed by that date. The AC is the actual cost incurred for the work done by that date. You should validate your PV, EV, and AC data by comparing them with the source documents, such as the project plan, the schedule, the invoices, the timesheets, and the progress reports. You should also verify that the data are collected and reported in a consistent and timely manner, and that they are adjusted for any changes in scope, schedule, or budget.
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We can validate the planned value PV in points 1.we have to check the project plan by ensuring the planned value with the project schedule and the budget allocated to each task or work package. 2.we have to compare it with the baseline to define the deviation . and We can validate the Earned value EV in points : 1.Confirm that the EV is based on actual progress and work completed. 2.Ensure that the criteria used to measure progress and determine earned value are align with the project plan. 3.check EV calculations using Earned Value Management (EVM) formulas.
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Validate Earned Value (EV): Define Measurable Milestones: Clearly define the criteria for earned value measurement, such as completion of deliverables, milestones, or percent complete estimates for work packages. Use Objective Measurement Methods: Employ objective methods for measuring earned value, such as physical progress, completion of specific tasks, or achievement of predefined criteria. Compare EV to Actual Progress: Validate that the earned value reflects the actual progress achieved on the project. Compare EV to completed work and milestones to ensure consistency and accuracy. Consider Quality and Performance: Take into account the quality and performance of completed work when measuring earned value.
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Validate Planned Value (PV): Review Work Packages and Activities: Ensure that the scope of work within each work package or activity is clearly defined and aligned with the project's WBS or PBS. Verify Schedule Baseline: Compare the planned start and end dates for activities against the project schedule baseline. Any deviations may indicate discrepancies in planned value calculation. Assess Resource Availability: Validate that the planned resource allocation (e.g., labor hours, equipment usage) aligns with resource availability and capacity. Review Assumptions and Constraints: Evaluate the assumptions and constraints underlying the planned value calculations. Ensure that they are realistic and accurately.
The EVM formulas and indicators are the tools that help you analyze your EVM data and assess your project performance. The most common EVM formulas and indicators are the cost variance (CV), the schedule variance (SV), the cost performance index (CPI), the schedule performance index (SPI), the estimate at completion (EAC), the estimate to complete (ETC), and the variance at completion (VAC). You should review your EVM formulas and indicators regularly to ensure that they are calculated correctly and that they reflect the current status and trends of your project. You should also understand the assumptions and limitations behind each formula and indicator, and how they affect your interpretation and decision making.
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The main aim of the EVM formulas is to assess the efficiency and effectiveness of the performance and progress and to analyze these variances, in order to know the project's current status and the forecasted performance and progress. So, You have to care more about these formulas and indices and make sure the results reflect the project status, to make a decision for corrective or a decision for reinforcement.
Another way to evaluate your EVM data and assumptions is to compare them with other sources of information, such as the project stakeholders, the project team, the quality metrics, the risk register, the issue log, and the lessons learned. You should seek feedback from your project stakeholders and team members on the accuracy and reliability of your EVM data and assumptions, and how they align with their expectations and perceptions. You should also check your quality metrics, such as defects, rework, customer satisfaction, and compliance, to see if they correlate with your EVM data and indicators. You should also review your risk register, issue log, and lessons learned to identify any potential or actual impacts on your EVM data and assumptions, and how to mitigate or resolve them.
Finally, you should update your EVM data and assumptions as needed to reflect the changes and realities of your project. EVM is not a static or fixed method, but a dynamic and flexible one that requires constant monitoring and adjustment. You should update your EVM data and assumptions whenever there are significant changes in scope, schedule, budget, quality, risk, or stakeholder requirements. You should also update your EVM data and assumptions based on the results of your evaluation and analysis, and the feedback from your project stakeholders and team members. Updating your EVM data and assumptions will help you improve your project performance and deliver value to your customers.
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Evaluate EVM data by comparing planned vs. actual costs and schedules. Analyze variances to identify discrepancies and adjust assumptions accordingly. Utilize Monte Carlo simulation for robust risk analysis. For instance, in a solar energy project, validate EVM data against real-time performance metrics like energy output to ensure accuracy and reliability.
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