Earned Value Analysis. Project controlling with the earned value.

What is an earned value analysis and how does it work? How is it valuable?

Earned Value Analysis Overview

Goals of the earned value analysis

The earned value analysis (EVA) is a project controlling procedure and is one of the key performance indicators of a project, like the cumulative flow diagram. With the EVA, the planned and current costs of a project are identified on any desired reporting date, as well as the earned value, as well as other figures like time and cost efficiency. Based on these values, the future course of the project and the predicted completion cost can be calculated long before the end of the project.

For example, the earned value analysis answers the following questions:

  • Am I behind schedule if my actual costs are lower than the planned costs?
  • What will the project end up costing? Is that within the budget?
  • Am I using the available time and resources efficiently?
  • How high will the profit/return on investment (ROI) be at the end of the project?

Why do you need the earned value?

Thinking back to the triangle of classical or agile project management, there are three values in a project: workload, time and scope. The scope is often called Result or Quality.

In comparison to other project controlling methods the earned value analysis doesn’t just consider the time and workload through a comparison of the expected and actual situations, but also takes the extent of the earned value into the analysis – so how many work results have already been created. Through this, different questions – for example, about exceeding the planned costs – can be answered: should that be assessed negatively, or has the work just been done more quickly than expected?

Read more about the triangle of classical and agile project management here »