I’ve been very busy lately. In addition to doing my day job, attending to my family and home duties, consuming a number of books (one of which I am about to include in a post I have started drafting) I have also been working (with two of my colleagues) on drafting an easy-to-digest Earned Value Management Guide, where we attempted to write key components of the ANSI/EIA-748-B-2007 and AS 4817-2006 in a language that can be read and understood by simple-minded people.
Having had the opportunity to socialize this work with other project managers it has become clear that while many project managers are aware of the term Earned Value Management, or even EVM, many are confused when it comes to understanding the distinction between the terms Earned Value, Earned Value Management and Earned Value Management System.
Let’s see if we can sort out and clarify this confusion:
Earned Value is a single metric that represents the Budgeted Cost of the Work Performed.
Earned Value Management is a set of performance management metrics that integrate cost, schedule and technical performance into a combined set of (backward and forward-looking) performance indicators.
Earned Value Management System is the combination of tools and processes that enable the recording of planned cost, schedule and technical performance data, and then the subsequent measurement of progress, identification of variances and the forecasting of the project performance going forward. This cycle of plan, measure, forecast is then used to elicit any corrective action required to bring the project back on track.