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Tips Of Earned Value Management System That Organizations Need To Know

By George Butler As much as organizations rely on earned value schemes to predict the success of their project, the scheme has some limita...

By George Butler


As much as organizations rely on earned value schemes to predict the success of their project, the scheme has some limitations that organizations can not accomplish using it. However, the advantages that companies get from implementing the structure over-weigh the limitation and this should not be a reason for them not using the scheme. Here are some of the limitations organizations are bound to experience when using Earned value management system.

The EVMs can be used to predict the project success prior to its commencement. This is due to the principles the model uses which have shown a positive correlation when it comes to project success. This helps management to predict with certainty the success of their projects thus allowing them to invest on projects which are successful.

It also helps organizations to easily break down their structure in terms of cost, work integration and scheduling. In cases where the company has different functional areas like manufacturing, engineering or accounting, use of product orientation can help coordinate and organize each department contributions while ensuring that cost, job and schedule are well integrated.

For staffs to use the scheme well, they need to undergo proper training. This is because if they do not fully utilize the earned value data send to them there are chances that the project will fail. The cost of training the staffs is costly and also time consuming.

When planning for projects, this EVMS predict the final cost of the whole project by use of the cost performance index that is CPI. This can help the management know whether that project will be successful or not according to the results they obtain before launching such a project. The system also helps organizations to measure how the venture is being carried out. They are in a position to check whether the activities that they had allocated to be accomplished within a given period of time have been achieved and if not, the system can draw some suggestions on how to reduce the chances of project derailment. This helps companies to determine whether the project will be successful or not.

The metrics of the earned value structure of administration are very reliable when it comes to project performance prediction. The system achieves this by combining the project scope, schedule and cost as a three metric dimensions that collectively can be used to predict and measure the performance. These three metrics have proven to be accurate and realistic thus making the model be relied by practitioners.

By use of EVMs the accountability of managers and employees is enhanced. This is because they are can accurately track their time by ensuring that they are not behind time. This information is very crucial to the stakeholders and can easily track who is behind time. This helps reduce laxity levels.

To ensure that the such schemes works best for your organization, companies should ensure that they implement the scheme at the beginning of the project but not when a project is in progress. Also the system requires an expert planning to ensure that all the project stages are executed well.




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