Earned value management system as a project management Tool for major multi-disciplinary projects

Abstract

The Earned Value Management System (EVMS) is a useful management tool available for project managers to monitor and control major multi-disciplinary projects. EVMS measures project performance by comparing the amount of work planned against the amount of work actually carried out and the actual costs incurred. EVMS combines the work scope, schedule and the cost elements of a project and facilitates the integrated reporting of a project’s progress and the cost status. The earned value concept was first introduced by industrial engineers working in American factories over a century ago and this concept was used to manage the production cost of commercial industrial products. The basic concepts of earned value were adopted by the United States Air force in the early 1960s and later endorsed by the United States Department of Defence in all major system acquisitions. Earned Value Management is a technique that can be applied to the management of all infrastructure projects, in any industry, while employing any contracting approach. This paper summarizes the basic concepts and the theory of EVMS, briefly explains how EVMS can be implemented for a multi-disciplinary project, the challenges encountered during implementation and its benefits to a project as a project management tool.