Earned Value Management (EVM) compares planned work, completed work, and actual cost against a defined project baseline.
Definition
EVM uses a project’s approved scope, schedule, and budget baseline to compare the value of work planned with the value of work completed and the cost incurred. A project team may use those comparisons to report cost and schedule performance, forecast outcomes, or identify areas for investigation. Results depend on how the team measures progress, assigns budget to work, and records costs. Civil engineering firms may encounter formal EVM requirements on some contracts, while other projects use simpler progress and budget tracking. The level of detail and reporting method should fit the contract and project controls. EVM is not a substitute for sound scope definition, reliable cost records, or professional judgment, and a favorable measure alone does not establish that a project is on track in every respect. The U.S. Government Accountability Office’s EVM guide discusses its use in managing projects.
How owners use it
- A project manager compares planned progress with accepted work and labor cost to locate variances for review.
- An owner reviews trends across projects to understand where estimates or progress measures may need attention.
- If earned value is $90,000 and planned value is $100,000, then $90,000 - $100,000 = -$10,000 schedule variance under that measure.
