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Earned Value Management (EVM)

Integrating scope, schedule, and cost for performance measurement.

This topic covers the principles of Earned Value Management (EVM), explaining how to use EVM metrics like Schedule Performance Index (SPI) and Schedule Variance (SV) to assess project schedule performance.
5 minutes 5 Questions

Earned Value Management (EVM) is a project management methodology that integrates scope, schedule, and cost to measure project performance and progress. It's a crucial tool in the PMI Scheduling Professional's toolkit for objective project assessment. EVM uses three primary data points: 1. Planned…

Concepts covered: Actual Cost (AC), Earned Value (EV), Estimate at Completion (EAC), Schedule Variance (SV), To-Complete Performance Index (TCPI), Cost Variance (CV), Cost Performance Index (CPI), Planned Value (PV), Schedule Performance Index (SPI)

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PMI-SP - Earned Value Management (EVM) Example Questions

Test your knowledge of Earned Value Management (EVM)

Question 1

In an agile project using Earned Value Management (EVM), what does a consistent Schedule Variance (SV) of +$5000 across three consecutive sprints indicate about team velocity?

Correct Answer: The team is delivering more value than planned, maintaining a steady pace ahead of schedule

A consistent positive Schedule Variance (SV) of +$5000 across three consecutive sprints clearly indicates the team is performing ahead of schedule and maintaining a steady, productive pace. Key points to consider: - The positive SV shows the team is delivering more value than planned - The consistency over three sprints demonstrates this is not a temporary spike but a stable performance pattern - The steady value (+$5000) indicates reliable and predictable delivery Why other answers are incorrect: - Additional resources are not required since the team is already performing well at their current capacity - While resource allocation may be good, the focus should be on the ahead-of-schedule performance rather than resource optimization - The variance is not related to scope creep - it simply shows work is being completed faster than planned while maintaining the agreed scope

Question 2

During a system upgrade project, which combination of Schedule Variance (SV) values is most concerning when measured at two sequential milestones?

Correct Answer: First milestone SV = -$8,000, second milestone SV = -$16,000

The most concerning Schedule Variance (SV) pattern shows both negative values AND a worsening trend. Looking at the sequential milestone measurements: The combination showing SV = -$8,000 followed by SV = -$16,000 is most concerning because: 1. Both values are negative, indicating the project is behind schedule 2. The variance is doubling (from -$8,000 to -$16,000) 3. This indicates an accelerating negative trend that needs urgent correction The other combinations are less concerning because: - A pattern showing improvement (from -$15,000 to -$7,000) indicates recovery - Consistent negative values (-$10,000 to -$10,000) while not good, at least show the situation isn't deteriorating - Improving from -$12,000 to -$8,000 shows positive progress in schedule recovery The accelerating negative trend presents the highest risk to project success and requires the most urgent corrective action.

Question 3

In a manufacturing project where Schedule Variance (SV) equals +$25,000 and EV is $175,000, what is the best interpretation considering planned value metrics?

Correct Answer: The project has completed more work than planned, with actual progress ahead of schedule by $25,000

Let's analyze this step by step: 1. Schedule Variance (SV) = EV - PV 2. Given: SV = +$25,000 and EV = $175,000 3. Therefore: $25,000 = $175,000 - PV 4. This means PV = $150,000 A positive Schedule Variance indicates that the project is ahead of schedule. The formula tells us how much more (or less) work has been completed compared to what was planned. In this case, the +$25,000 SV means that $25,000 more work has been completed than was planned at this point, making the project ahead of schedule. The other options are incorrect because: - Referring to resource allocation inefficiencies is misleading as SV only measures schedule performance, not resource usage - The need for additional metrics, while always helpful, does not address the direct interpretation of the given SV - Interpreting SV as cost savings is incorrect because SV measures schedule performance in terms of work completed, not actual costs

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