Integrated cost, quality, risk and schedule control through earned value management (EVM)

2019 ◽  
Vol 17 (1) ◽  
pp. 183-203 ◽  
Author(s):  
Tahereh Khesal ◽  
Abbas Saghaei ◽  
Mohammad Khalilzadeh ◽  
Masoud Rahiminezhad Galankashi ◽  
Roya Soltani
Keyword(s):  
Project Managers ◽  
Value Management ◽  
Accurate Information ◽  
Schedule Control ◽  
Earned Value ◽  
Earned Value Management ◽  
Quality Cost ◽  
Content Type ◽  
The Status ◽  
Integrated Cost

PurposeThe purpose of this paper is to propose an integrated earned value management (EVM) approach to control quality, cost, schedule and risk of projects.Design/methodology/approachThis study represents a new EVM framework by considering a quality control index. Particularly, some control indices and cumulative buffers are defined by two proposed, methods, namely the linear- and Taguchi-based methods. These methods are implemented in three different projects in different industries.FindingsAccording to the results, integration of the quality index creates a better control situation by providing more accurate information. Hence, project managers could comprehensively monitor the status of important factors to make more precise decisions while maintaining the simplicity of their analysis.Originality/valueFrom the methodological and theoretical features, this paper offers new visions because, to the best of authors’ knowledge, no comparable study has been conducted before.

Cost/Schedule Monitoring and Forecasting for Project Based on Earned Value Management (EVM)

2014 ◽  
Vol 919-921 ◽  
pp. 1437-1440 ◽  
Author(s):  
Jian Wen Huang ◽  
Hui Min Pan ◽  
Yan Li ◽  
Yi Ting Zhu ◽  
Zai Yi Liao
Keyword(s):  
Project Managers ◽  
Value Management ◽  
Earned Value ◽  
Earned Value Management ◽  
Traditional Concept ◽  
The Status ◽  
Monitoring And Forecasting ◽  
Ultimate Outcome ◽  
And Performance ◽  
The Cost

Earned value management (EVM) is one of the most widely used control tools in project management. It is a well-known management system that integrates cost, schedule and performance. Based on the traditional concept of EVM, the cost/schedule monitoring and forecasting model is proposed in this paper. It gives us the analysis steps and provides the methods for monitoring the actual situation and forecasting the final cost and duration. By using this model, the managers are able to know timely the status of a project in terms of budget and schedule and forecast the developing trend and ultimate outcome of the project. So it is a reliable method to improve the capability of project managers for making reasonable decisions.

Directed earned value management based on ordered fuzzy numbers

2021 ◽  
pp. 1-14
Author(s):  
Seyed Taha Hossein Mortaji ◽  
Siamak Noori ◽  
Morteza Bagherpour
Keyword(s):  
Fuzzy Numbers ◽  
Lower Cost ◽  
Project Managers ◽  
Value Management ◽  
Monitoring And Control ◽  
Earned Value ◽  
Earned Value Management ◽  
Project Monitoring ◽  
And Control

Earned value management is well-known as the most efficient method of project monitoring and control providing relatively reliable information about the project performance. However, this method requires accurate estimates of the progress of project activities, which are always associated with uncertainties that, if ignored or not addressed well, lead to incorrect results. To address this issue, the application of multi-valued logic, in particular fuzzy logic, in earned value management has recently attracted a lot of attention both in practice and research. This paper introduces directed earned value management (DEVM) in which ordered fuzzy numbers are used to express the so-called uncertainties as well as to capture more information about the trend of the project progress. To evaluate the performance of the proposed method, several numerical examples and a case study are presented. The results reveal that compared to the existing methods, DEVM has a lower computational complexity. Also, it doesn’t suffer from the overestimation effect and as a result, it has a higher ability to express project-specific dynamics. In sum, the proposed method allows project managers to make informed decisions that lead to taking preventive and corrective actions promptly and at a lower cost.

Project control and forecast assessment of building projects in Pakistan using earned value management

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Hafiz Zahoor ◽  
Rashid Mehmood Khan ◽  
Ahsan Nawaz ◽  
Muhammad Ayaz ◽  
Ahsen Maqsoom
Keyword(s):  
Current Status ◽  
Value Management ◽  
Earned Value ◽  
Earned Value Management ◽  
Building Projects ◽  
Content Type ◽  
Similar Work ◽  
Progress Reporting ◽  
Schedule Performance ◽  
Under Construction

PurposeEarned Value Management (EVM) is widely used as a project performance measurement and forecasting technique. Nonetheless, it has not been fully explored in Pakistani construction industry; where conventional progress reporting methodology (CPRM) is being followed having certain confines. It reports only the financial progress of a project, expresses feeble association between the duration and cost of activities, and forecasts flawed schedule and completion cost. This research implements EVM on under-construction building projects in Pakistan, and compares its upshots with the projects' actual records and with the outcomes of CPRM.Design/methodology/approachTo assess the implementation of EVM on building projects, a set of specific criteria was established. Work Breakdown Structure, Organization Breakdown Structure and Control Points were established. The study has compared the EVM metrics with CPRM outcomes on three under-study building projects, and has deliberated on their mutual differences as well as their relationship with actual cost and schedule performance. Monthly figures of actual spending and completed activities were periodically recorded and compared with planned values for status indication. The graphs were generated to observe the correlation between the results of EVM and CPRM. The data was then extrapolated to forecast the schedule and cost values at completion.FindingsThe study discovered that trends of EVM in quantifying the project's cost and schedule performance were strongly correlated and were closer to the actual progress. It has also verified the EVM's soundness in forecasting the cost and schedule, required for project's completion. Contrarily, CPRM metrics could not precisely visualize the current and future, cost and schedule performance.Originality/valueThe case study concludes that EVM's incorporation in progress reporting regime can revolutionize the assessment procedures in Pakistan by rightly indicating the project's current status as well as visualizing the future performance. The study's methodology can also be extrapolated in other countries having similar work environment and economic conditions.

Revisiting reliability of estimates at completion for department of defense contracts

2019 ◽  
Vol 19 (3) ◽  
pp. 186-200
Author(s):  
Deborah B. Kim ◽  
Edward D. White ◽  
Jonathan D. Ritschel ◽  
Chad A. Millette
Keyword(s):  
Department Of Defense ◽  
Value Management ◽  
Critical Ratio ◽  
Early Assessment ◽  
Earned Value ◽  
Earned Value Management ◽  
Content Type ◽  
Cent Error ◽  
Defense Contracts ◽  
The Cost

Purpose Within earned value management, the cost performance index (CPI) and the critical ratio (CR) are used to generate the estimates at completion (EACs). According to the research in the 1990s, estimating the final contract’s cost at completion (CAC) using EACCR is a quicker predictor of the actual final cost versus using EACCPI. This paper aims to investigate whether this trend stills holds for modern department of defense contracts. Design/methodology/approach Accessing the Cost Assessment Data Enterprise (CADE) database, 451 contracts consisting of 863 contract line item numbers (CLINs) were initially retrieved and analyzed in three stages. The first replicated the work conducted in 1990s. The second stage entailed calculating 95 per cent confidence intervals and hypothesis tests regarding percentage accuracy of EACs for a contract’s final CAC. Lastly, regression analysis was conducted to characterize major, moderate and minor influencers on EAC reliability. Findings For modern contracts, EACCR aligns more with EACCPI and no longer demonstrates early accuracy of a contract’s final CAC. Contract percentage completion strongly reduced the per cent error of estimating CAC, while cost-plus-fixed-fee contracts and those with no work breakdown structure greater than Level 2 negatively affected accuracy. Social implications To militate against optimism of early assessment of a contract's true cost. Originality/value This paper provides empirical evidence that EACCR behaves more like EACCPI with respect to modern contracts, suggesting that today’s contracts have relatively high SPI. Therefore, caution is warranted for program managers when estimating the CAC from contract initiation up to and slightly beyond the mid-point of completion.

Predicting the project time and costs using EVM based on gray numbers

2019 ◽  
Vol 26 (9) ◽  
pp. 2107-2119 ◽  
Author(s):  
Samira Nadafi ◽  
Seyed Hamed Moosavirad ◽  
Shahram Ariafar
Keyword(s):  
Completion Time ◽  
Construction Projects ◽  
Design Methodology ◽  
Value Management ◽  
Earned Value ◽  
Earned Value Management ◽  
Content Type ◽  
Project Completion ◽  
Practical Implications ◽  
Significant Point

PurposeThe purpose of this paper is to determine the project completion time and cost under non-deterministic conditions using interval gray numbers (IGNs).Design/methodology/approachThe earned value management (EVM) method based on the IGN has been developed.FindingsThe EVM method based on the IGN has been verified by a numerical example that can be applied to construction projects.Practical implicationsThe EVM method, based on the gray numbers, reduces the budget and time shortage risk. Also, using this method, the managers would not be restricted to provide very exact values in their progress reports in the non-deterministic conditions.Originality/valueOne notable and significant point in all projects during the execution process is to estimate the project completion time and cost. However, non-deterministic conditions for both planned and actual physical completion percentage of projects have not been considered for predicting the project completion time and cost in the literature. Therefore, the novelty of this paper is the prediction of project completion time and cost under non-deterministic conditions using IGN.

scholarly journals Risk factors affecting the ability for earned value management to accurately assess the performance of infrastructure projects in Australia

2019 ◽  
Vol 19 (4) ◽  
pp. 550-569 ◽  
Author(s):  
Maan Nihad Ibrahim ◽  
David Thorpe ◽  
Muhammad Nateque Mahmood
Keyword(s):  
Risk Factors ◽  
Construction Projects ◽  
Project Performance ◽  
Value Management ◽  
Earned Value ◽  
Related Factors ◽  
Earned Value Management ◽  
Content Type ◽  
Factors Affecting ◽  
Factors Influencing

Purpose The purpose of this paper is to investigate a set of risk-related factors influencing the earned value management (EVM) concept as an assessment technique in evaluating the progress of modern sustainable infrastructure construction projects. Design/methodology/approach A qualitative research approach has been adopted for identifying risk-related factors influencing EVM concept from a literature review and through interviewing industry personnel, followed by an inductive process to form sets of key factors and their measuring items. Findings EVM is a common method for assessing project performance. A weakness of this approach is that EVM assessment in its current form does not measure the impact of a number of project performance factors that result from the complexity of modern infrastructure construction projects, and thus does not accurately assess their impact in this performance. This paper discusses and explains a range of potential risk factors to evaluating project performance such as sustainability, stakeholder requirements, communication, procurement strategy, weather, experience of staff, site condition, design issues, financial risk, subcontractor, government requirements and material. In addition, their measuring items were identified. Practical implications This research assists projects managers to improve the evaluation process of infrastructure construction performance by incorporating a range of factors likely to impact on that performance and which are not included in current EVM calculations. Originality/value This research addresses the need to include in the EVM calculation a range of risk factors affecting the performance of infrastructure projects in Australia and therefore makes this calculation a more reliable tool for assessing project performance.

Stability and accuracy of deterministic project duration forecasting methods in earned value management

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Alexis Barrientos-Orellana ◽  
Pablo Ballesteros-Pérez ◽  
Daniel Mora-Melia ◽  
Maria Carmen González-Cruz ◽  
Mario Vanhoucke
Keyword(s):  
Control Technique ◽  
Value Management ◽  
Earned Value ◽  
Earned Value Management ◽  
Content Type ◽  
Project Duration ◽  
Project Networks ◽  
Forecasting Methods ◽  
Stability And Accuracy ◽  
Accuracy And Stability

PurposeEarned Value Management (EVM) is a project monitoring and control technique that enables the forecasting of a project's duration. Many EVM metrics and project duration forecasting methods have been proposed. However, very few studies have compared their accuracy and stability.Design/methodology/approachThis paper presents an exhaustive stability and accuracy analysis of 27 deterministic EVM project duration forecasting methods. Stability is measured via Pearson's, Spearman's and Kendall's correlation coefficients while accuracy is measured by Mean Squared and Mean Absolute Percentage Errors. These parameters are determined at ten percentile intervals to track a given project's progress across 4,100 artificial project networks with varied topologies.FindingsFindings support that stability and accuracy are inversely correlated for most forecasting methods, and also suggest that both significantly worsen as project networks become increasingly parallel. However, the AT + PD-ESmin forecasting method stands out as being the most accurate and reliable.Practical implicationsImplications of this study will allow construction project managers to resort to the simplest, most accurate and most stable EVM metrics when forecasting project duration. They will also be able to anticipate how the project topology (i.e., the network of activity predecessors) and the stage of project progress can condition their accuracy and stability.Originality/valueUnlike previous research comparing EVM forecasting methods, this one includes all deterministic methods (classical and recent alike) and measures their performance in accordance with several parameters. Activity durations and costs are also modelled akin to those of construction projects.

scholarly journals An Improved Earned Value Analysis Tool for Mitigating Progress Risks in Long Duration Projects

2019 ◽  
Vol 281 ◽  
pp. 05001
Author(s):  
Ali Fayad ◽  
Bassam Hussein ◽  
Elie Maalouf ◽  
Amin Haj-Ali
Keyword(s):  
Net Present Value ◽  
Value Management ◽  
Accurate Information ◽  
Analysis Tool ◽  
Earned Value ◽  
Earned Value Management ◽  
Value Analysis ◽  
Earned Value Analysis ◽  
Risk Management Process ◽  
Management Method

As a risk control tool, earned value analysis is crucial for identifying risky trends in the budget or schedule of a project. This tool relies on earned value management, a method for calculating cost and schedule variances. However, this method does not take into account the time value of money. This in itself is a threat that could lead to misleading data and eventually wrong decisions. This paper explores the risk management process, the earned value management method, and proposes a methodology that compliments the earned value management method with net present value calculations. This will allow project managers to take sound decisions based on more accurate information.

scholarly journals A Matrix Model for Effective of Project Management

2017 ◽  
Vol 5 (2) ◽  
Author(s):  
Samuel Y. Ruan ◽  
Yuan-Ho Chen
Keyword(s):  
Performance Assessment ◽  
Performance Index ◽  
Conversion Rate ◽  
Project Performance ◽  
Project Managers ◽  
Assessment Model ◽  
Value Management ◽  
Earned Value ◽  
Earned Value Management ◽  
And Control

For earned value management (EVM), when an organization attaches nonequal importance to the schedule performance index (SPI) and cost performance index (CPI) of a project, a nonequal-weighted conversion rate between the SPI and CPI is formed. This study employed EVM to integrate SPIs and CPIs to establish a matrix project performance assessment model with a nonequal-weighted conversion rate between the SPI and CPI. This model improves the disadvantages of conventional performance assessment models and enables project managers to simultaneously monitor and control the costs and schedules of their projects. The results provide a practical project performance assessment model for various industries and a basis for developing a project performance assessment information system, thus confirming the practicality and applicability of this study. 

scholarly journals Beyond Earned Value Management: A Graphical Framework for Integrated Cost, Schedule and Risk Monitoring

2013 ◽  
Vol 74 ◽  
pp. 181-189 ◽  
Author(s):  
Fernando Acebes ◽  
Javier Pajares ◽  
José Manuel Galán ◽  
Adolfo López-Paredes
Keyword(s):  
Value Management ◽  
Earned Value ◽  
Earned Value Management ◽  
Risk Monitoring ◽  
Integrated Cost
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