Earned Value Research
Research: Earned Value Management Systems
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. We have started a new research project where we measure the forecast accuracy of earned value metrics in project management. This research project is in collaboration with Stephan Vandevoorde from Fabricom Airport Systems www.fabricomairports.com.
Reference:
1. 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
2. An overview of the terminology of duration forecasting methods
Reference:
We have summarized the current state-of-the-art research dealing with forecasting metrics to predict a project's final duration.
3. A forecast accuracy simulation study
References:
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.
4. Using activity sensitivity and network topology information to monitor project time performance
Reference:
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.
5. More Information
For more information about the novel 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