Martin Training Associates

A Step by Step Approach to
Earned Value Management

Earned Value Workshop Overview

This workshop addresses earned value management system (EVMS) concepts, applications and issues in the context of performance-based management and budgeting. It uses case studies throughout to reinforce the concepts. It addresses: organizing the project work; planning for performance management; accumulating performance data; monitoring project performance; maintaining the project baseline; assessing project performance; and the system compliance process. This seminar is designed for the person new to the world of performance-based management and EVMS and also for those who are looking for a refresher/update on these topics.

Workshop Target Audience

Project managers, project engineers, other project personnel who independently monitor and analyze project schedule performance.

Length of Workshop

3 Days

The workshop emphasizes many important techniques including:

  • Understanding the basic concepts of earned value
  • Integrate the scope, schedule and cost elements of the project
  • Understand the critical distinctions between budget and funds
  • Understand the management control point concepts behind the control account
  • Define control accounts in both traditional functional and IPD environments
  • Effectively define candidates for the role of control account manager
  • Better define work and planning packages as well as relate them to activities within the schedule
  • Select the most appropriate EV techniques for individual work packages
  • Apply the rolling wave planning principles
  • Develop and/or analyze a control account plan
  • Understand management reserve and how to establish a meaningful amount
  • Understand undistributed budget
  • Identify the optimal point of measurement for material for the organization
  • Better understand what are and aren't appropriate change practices in a baseline environment
  • Close an in-process work package
  • Make changes to future portions of an in-process work package
  • Calculate efficiency factors such as the CPI, SPI and TCPI
  • Avoid common pitfalls associated with data analysis
  • Develop and/or analyze graphical depictions of performance information

Detailed Agenda

DAY ONE

Introduction to Earned Value

  • The basic concepts of earned value management
  • The earned value data elements
  • Funds vs. budgets

Organizing the Project Work

  • The work breakdown structure (WBS): development, benefits and guidelines
  • The WBS dictionary
  • Assignment of responsibility and Control Account identification
  • Control account "size" rules of thumb

Planning

  • The integrated baseline concepts
  • Top down and bottom up planning concepts
  • Work packages: definition, characteristics, development guidelines
  • Earned value techniques for calculation of Budgeted Cost for Work Performed (BCWP)
  • Apportioned effort tasks
  • Level of effort (LOE) tasks
  • The rolling wave concept
  • Essential scheduling system characteristics
  • Case Study: Application of Earned Value Techniques

DAY TWO

  • Case Study: Control Account Plan Preparation
  • The Contract Budget Base (CBB) and the Performance Measurement Baseline (PMB)
  • Management reserve and undistributed budget
  • Budget element relationships

Work Authorization

  • Reviewing planning for approval
  • Authorization to perform work
  • Case Study: Contract Baseline Establishment

Monitoring Project Performance

  • Accounting for costs
  • Data accumulation
  • Cost, schedule and at completion variances
  • Defining a "significant" variance
  • The variance analysis process
  • Elements of an effective variance analysis
  • Corrective action plans
  • Development of the estimate at completion (EAC)
  • Case Study: Statusing the control account plan
  • Case Study: Control account performance analysis

DAY THREE

Controlling/Maintaining the Baseline

  • Types of changes impacting project cost and schedule baselines
  • Change traceability
  • Disciplines inherent to baseline stability
  • Re-planning vs. rebaselining
  • Over target baselines
  • Replanning/closing in-process work packages
  • Over target schedules
  • Calculating cost and schedule efficiency factors: SPI, CPI,TCPI
  • Developing calculated, independent estimates at completion (IEAC)
  • Case Study: Cost Performance Report (CPR) Analysis
  • Data analysis pitfalls: invalid data, unrealistic baselines, washout, data time lags, too much emphasis on history
  • Material price and usage variances
  • Case Study: Detailed Data Analysis of Control Account Performance
  • Graphical analysis techniques: Effective trend illustration, common data plots, the Bulls' Eye Chart
  • Class graphical analysis of data from actual major acquisition programs

Summary and Wrap Up

  • Review and Recap

PDU's

21 Units

Prerequisites

Basic Project Management training

Materials Provided

Workshop notebook