EVM

What is Earned Value Management?

Earned Value Management (EVM) is a project management system that combines schedule performance and cost performance to answer the question, “What did we get for the money we spent?”


Basic concepts of EVM: All project steps “earn” value as work is completed. The Earned Value (EV) can then be compared to actual costs and planned costs to determine project performance and predict future performance trends. Physical progress is measured in dollars, so schedule performance and cost performance can be analyzed in the same terms.

Earned Value has been used since the 1960’s by the Department of Defense as a central part of the C/SCSC (Cost/Schedule Control Systems Criteria). Recently, the DOD revised the 35 criteria contained in the C/SCSC and produced the 32 criteria for EVMS (Earned Value Management Systems).

These criteria have since been accepted by the American National Standards Institute/Electronic Industry Association as a new standard, called ANSI/EIA 748. Now, EVM is being used in a wider variety of government contracts, and is spreading through the private sector as a valuable tool for project managers.