Earned Value Overview
Primavera Cloud provides the necessary tools to practice earned value management, a project management technique to measure project performance against a project plan. As your project progresses, activities may be delayed, additional resources may be required, and labor costs may increase. Conversely, there are times when activities are completed ahead of schedule, with fewer resource hours, and for less money than initially planned. Earned value management enables you to track, at the project and activity levels, whether you are ahead of or behind schedule and under or over budget. Use earned value to identify the areas of your project that did or did not progress according to the project plan, assess the current state of your project in terms of schedule and cost, and estimate future performance based on your progress so far.
Project progress is measured by comparing values in the current schedule to corresponding baseline values. To track earned value, you must designate an existing baseline as your earned value baseline. This will enable earned value calculations to be performed. Earned value is calculated for individual resource assignments and rolls up to the activity level. Activities without assignments use activity-level units and costs to calculate earned value. Activity-level earned value data also rolls up and is displayed at the WBS and project levels.
The following fields form the basis of all other earned value fields and their calculations:
- Planned Value: The budgeted cost of work that is scheduled to be performed by a specified date, which is typically the project's data date. You can think of this as the approved budget, which is captured by the earned value baseline.
- Earned Value: The budgeted cost of work that has actually been performed by a specified date. You can think of this as the portion of the approved budget that has been completed.
- Actual Cost: The actual cost of work that has actually been performed by a specified date. Whereas the Earned Value field measures how much of the approved budget has been performed, Actual Cost indicates the total cost required to actually perform the work.
These fields are used in many earned value calculations and can be combined with other project data to track schedule and cost variances, performance indexes, estimates to complete the remaining work, and the estimates at completion of all work. Consult Understanding Earned Value Fields for a detailed breakdown of all earned value fields and calculations in Primavera Cloud. Incremental and total earned value metrics are also captured when using store period performance capabilities for your schedule, and some can be viewed in the activity usage histogram.
Before getting started with earned value, you should build out your project's schedule, run the scheduler to set the dates, recalculate your costs to update activity cost fields, and then set project baselines to establish initial values before work begins. Next, you should designate a baseline as your earned value baseline so that you can generate earned value metrics. Then, recalculate costs to set the initial Budget at Completion values for your current schedule to begin tracking earned value metrics.
Last Published Tuesday, May 21, 2024