Have you sat in a meeting recently where you heard someone say something such as, "We did terrible this month, we planned a lot of BCWS but claimed very little BCWP and our ACWP was far greater than our BCWP!" or even worse, "I claimed no P this month!" Who talks about claiming P? What kind of foreign nonsense is this? Why must we use it?
As if learning all (quite impossible if you ask me) the DoD acronyms is not complicated enough, they had to throw in another one: EVM. Earned Value Management (EVM) is a management tool (yes, another tool or process!), that gives Program Managers insight into cost, schedule, and performance on their respective program(s) or contract(s). I stress that it is a management tool, and should not be seen as just a contractual requirement. The DoD embraces EVM as an industry best practice and requires the use of the tool depending on a variety of factors such as contract type, contract value, risk, etc. That being said, those who still view EVM as a foreign entity will gain insight into the benefits of using the tool rather than staying as far away from it as contractually possible. Now, let's discuss what EVM as a "best practice" can do for a program manager and why it should be viewed as something helpful instead of a daily dose of required busy work. As stated previously, EVM manages the work scope, schedule, and cost and tracks the progress towards these goals. Implementing EVM effectively (that's the key!), allows a program manager to measure performance, manage cost, schedule risk, and forecast final cost - which can be the Program Manager's biggest nightmare or dream come true! Essentially though, EVM provides an early warning for any deviation from the scheduled baseline (planned work) and allows for implementation of necessary corrective actions. Let's look at a simple example from the company T-shirts "R" Us. They make...T-shirts!