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Earned Value Management

Research on Earned Value Management, including Earned Schedule

It is well-known that well managed and controlled projects are more likely to be delivered on time and within budget. The construction of a (resource-feasible) baseline schedule and the follow-up during execution are primary contributors to the success or failure of a project. Earned value management systems have been set up to deal with the complex task of controlling and adjusting the baseline project during execution. Although earned value systems have been proven to provide reliable estimates for the follow-up of cost performance, it often fails to predict to total duration of the project. Throughout the past years, we have done a lot of research on this project control topic, often in collaboration with companies such as Fabricom Airport Systems or organizations such as PMI-Belgium, EVM Europe, and more.

Research books

Book: Measuring Time - Improving Project Performance Using Earned Value Management

Earned Value Management (EVM) is a project management technique for measuring project progress in terms of cost, schedule and scope, and has developed into a very effective way to uncover performance problems at an early and correctible stage in any given project. From its earliest days as a financial analysis tool in the US in the early 1960's, it steadily grew in use through the US Department of Defense until it was made the standard measurement for all DoD, NASA, and Department of Energy projects, and was widely adopted by publicly-traded companies trying to comply with the 2002 Sarbanes-Oxley ruling calling for greater transparency and accountability. It has also long been used in software engineering projects.

Winning the 2008 Research Award from IPMA for his research leading to this proposed book, author Mario Vanhoucke has surveyed the published literature to find and evaluate the effectiveness of the latest developments (and established practices) in EVM. After first explaining the fundamentals and terminology of the practice, he explores all the latest research trends and then tests them against a group of fictitious projects to gauge their effectiveness, offering general results applicable to a wide set of project types that researchers and practitioners can use to expand their work in EVM-managed projects. With a focus on the simple calculations behind EVM systems, Vanhoucke shows how they can often lead to misinterpretation and frustration and how to avoid common mistakes.

Meant to complement rather than compete with the existing books on the subject, the proposed book deals with the project performance and control phases of the project life cycle to present a detailed investigation of the project's time performance measurement methods and risk analysis techniques in order to evaluate existing and newly developed methods in terms of their abilities to improve the corrective actions decision-making process during project tracking. As readers apply what is learned from the book, EVM practices will become even more effective in project management and cost engineering. Individual chapters look at simulation studies in forecast accuracy (under nine different scenarios); schedule adherence; time sensitivity; activity sensitivity; and using top-down or bottom-up project tracking. Vanhoucke also offers an actual real-life case study, a tutorial on the use of ProTrack software (newly developed based on his research) in EVM, and conclusions on the relative effectiveness for each technique presented. This will be an important read for anyone researching, using, or studying EVM and will certainly help to push the field forward in the coming years.

Source: www.amazon.com

Reference

  • Vanhoucke, M., 2009, "Measuring Time - Improving Project Performance using Earned Value Management", International Series in Operations Research and Management Science, Vol. 136, Springer.
  • Vanhoucke, M., 2010, “Measuring Time: An earned value performance management study”, The Measurable News, 1, 10-14.

Study 1. Time forecasting: an overview

One of our first papers on project control and Earned Value Management was published in the International Journal of Project Management and was mainly aiming at giving an overview of the terminology used in EVM and ES.
 
Reference: Vandevoorde, S. and Vanhoucke, M., 2006, “A comparison of different project duration forecasting methods using earned value metrics”, International Journal of Project Management, 24, 289-302.

Study 2. Time forecasting: An accuracy simulation study

We compare and evaluate the existing forecasting metrics based on a simulation approach on a large set of project networks. The working paper, the dataset and information about the dataset can be downloaded here. 
 
  • Ask more information
  • The data set containing 4,100 instances can be freely downloaded in text format or ProTrack format from our bookstore
References
  • Vanhoucke, M. and Vandevoorde, S., 2007, "A simulation and evaluation of earned value metrics to forecast the project duration", Journal of the Operational Research Society, 58, 1361–1374.
  • Vanhoucke, M. and Vandevoorde, S., 2007, "Measuring the accuracy of earned value/earned schedule forecasting predictors", The Measurable News, Winter, 26-30.
  • Vanhoucke, M., 2008, “Project tracking and control: can we measure the time?”, Projects and Profits, August, 35-40.
  • Vanhoucke, M. and Vandevoorde, S., 2009, "Forecasting a project's duration under various topological structures", The Measurable News, Spring, 26-30.
  • Vanhoucke, M., 2009, "Static and dynamic determinants of earned value based time forecast accuracy", in: Handbook of Research on Technology Management's Planning and Operations, 361-374.

Study 3. Project control: Integrating EVM and Risk Management

The interest in activity sensitivity from both the academics and the practitioners lies in the need to focus a project manager's attention on those activities that influence the performance of the project. When management has a certain feeling of the relative sensitivity of the various parts (activities) on the project objective, a better management's focus and a more accurate response during project tracking should positively contribute to the overall performance of the project. A simulation study is performed to measure the ability of four sensitivity metrics to dynamically improve the time performance during project execution. We measure the use of sensitivity information to guide the corrective action decision making process to improve a project's time performance, while varying the degree of management's attention. 
 
Ask more information 
References:
  • Vanhoucke, M., 2010, “Using activity sensitivity and network topology information to monitor project time performance”, Omega - International Journal of Management Science, 38, 359-370.
  • Vanhoucke, M., 2011, “On the dynamic use of project performance and schedule risk information during project tracking”, Omega - International Journal of Management Science, 39, 416-426.
  • Vanhoucke, M., 2012, “Measuring the efficiency of project control using fictitious and empirical project data”, International Journal of Project Management, 30, 252-263.
  • Vanhoucke, M. and Vandevoorde, S., 2008, "Earned value forecast accuracy and activity criticality", The Measurable News, Summer, 13-16.
  • Vanhoucke, M., 2012, “Dynamic Scheduling: Integrating Schedule Risk Analysis with Earned Value Management”, The Measurable News, 2, 11-13.

Interested? Visit the following sites:

For more information about the earned schedule method, we refer to www.earnedschedule.com
For more information about the book, the software tool and the consultancy projects, we refer to www.or-as.be.
If you want to use our research in your professional work, you can download our ProTrack software tool at www.protrack.be.


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