How do you keep track of every stage of project development down to its minute details such as tasks or even sub-tasks? Looks finicky?
The increasing complexity of today’s projects – industrial, infrastructure, software development – demands brute-strength project tools in managing the development cycle.
When you’re investing in a multi-million dollar development work or supervising a mammoth enterprise, your best safeguard against unpredictable risks is an intelligent project methodology to monitor progress vs. planned activities. When there are over 5,000 people on your payroll who must work together to deliver timely results, you’d want a way to predict potential budget deficits or cost overruns. The ability to mix and match the interacting factors of manpower, materials, and moments (or time) in a major undertaking requires no less than excellent managerial skills complemented by exacting tools. The alternative would be the accumulation of delays and creeps towards monumental disaster.
To be sure, project management has an extensive body of knowledge showing how the framework, methodologies, applications and best practices of the trade have kept up with the times. Earned Value Management (EVM) applies such a knowledge-driven project management methodology. It updates for the modern times core values of efficiency and effectiveness culled from a century of experience in America’s industrial factories.
In the typical monitoring and evaluation of a project, the measurement of its progress has largely focused on on-time delivery of expected outputs at a cost within an approved budget. The usual process is to track variances and then proceed to address deviations.
However, industry practitioners and government procurement program officers found out that financial factors told only half of the reasons why a project got completed on time or not. At every stage of project development, other relevant factors like project accomplishments and progress against schedule have very real impacts on project costs. For example, the project may have been completed on schedule, but a lot of overtime work had to be done at the final stages of the project to push actual costs beyond the budget. The result is a completed project with significantly reduced earnings for the project proponent or its investors.
The measurement therefore of variances among the technical performance, schedule and cost aspects can provide a better picture of project status. The correct interpretation of the relationships among these three project management factors can indicate the need for remedial action, as necessary, to keep the project on track. EVM provides such an environment that integrates and fully addresses these major project concerns.
EVM became an established project management methodology in the 1960s when the US Department of Defense supported its use in major government undertakings . By incorporating elements of Critical Path Method (CPM) and Project Evaluation and Review Technique (PERT), EVM implements a unique project progress tracking paradigm that integrates a project’s technical scope of work, budget and schedule in a single management control system.
