Project Earned Value Management System (EVMS) Procedure

The primary purpose of the Earned Value Management System (EVMS) procedure is to define and describe the GDMP/ MOMRA project control and management philosophy. This document also provides guidance to support the establishment and implementation of a project performance measurement system. The EVMS establishes an integrated system and approach for implementing logic-driven schedules, cost estimates, cost management, resource planning, earned value management, risk management, performance and cost forecasting, and progress measurement reporting on projects.
Earned Value Management (EVM) establishes a budget and schedule component for each element of work scope, at a level of detail appropriate to the degree of risk or uncertainty associated with the project. As these elements of work are completed, their budget values are “earned”. This progress is quantified and the Earned Value (EV) can be used to compare the amount accomplished to what was planned and how much was expended to complete that amount of work. This comparison indicates whether or not the work is over-budget, under-budget or on target, based on the value of the work, not just on the ability to spend money based on cash flow.
The Earned Value Management System (EVMS) provides the ability to analyse the schedule variances that cannot be seen if only comparing budget to Actual Cost. Comparing the current EV to what was planned to be accomplished indicates whether or not the work is ahead of schedule, on schedule or behind schedule. However, this only provides a SAR value comparison and does not indicate if the most critical work is being completed, if key milestones are on schedule, or planned finish dates are being maintained. The EVMS also provides information about cost variance (CV) compares the actual cost to the budget for completing the same amount of work. This provides for early identification of performance trends, issues, and changes from the baseline, and allows management to make decisions to implement corrective actions.