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Top Benefits Of Earned Value Management - Know Them!
Earned Value Management can produce greater productivity and growth within an organization, and how Online Earned Value Management Training helps individuals be more creative and vibrant in executing a project on time and to budget. Get a clear overview of the most effective project management approaches used by various individuals and organizations to enhance their baseline and garner high output productivity. This technique is used by managers and can be incorporated in any kind of project to produce high performance and effective decision making.
Problems faced by organizations include improper or unrealistic timelines, frequent project changes, & lack of goals, this could create poor bottom lines, improper time management, and a scope creep.
It could become very difficult for project managers to hit project deadlines if agile project management techniques are not setup in place. Organizations need to include Online EVM Training for project managers to execute their projects on time. The principle driver of EVM or Earned Value Management is its ability to track cost and time in real-time whilst comparing the current state of the project against original projections. This makes it easy for all the stakeholders to understand the actual requirements of the project and ensure timely success.
EVM can save your project through –
#1. Up-Front Project Planning
To deploy the right processes of Earned Value Management, project managers need to spend a good amount of time to build a strong baseline and practical time-frame. EVM is a single system or techniques that tracks project progress through three variables viz. money, time, and work. Project Managers do not have to indulge in learning multiple systems. Sketching out a project plan from the start to finish provides significant insight on how work needs to be distributed across a team.
#2. Practice Objectivity
With the adoption of EVM, project managers can clearly visualize project status for what has been done, what had to be done, and how much is left, and above all the cost it has generated in terms of Earned Value, Planned Value, and the Actual Costs. The generation of precise equations and clear data makes it very clear to determine whether the actual planning was realistic, and the steps that are actually required to move forward.
#3. Simplifying Transparency
The integration of Earned Value Management makes the whole project management process extremely transparent. Reason being, all the project stakeholders follow one system, and are constantly updated about the project progress in terms of real-time time and cost tracking. This makes the complete project management process extremely productive as it can be analyzed on who is putting in more effort, and who needs to put in more effort to garner better results.
#4. Anticipate and hook problems early on
Earned Value Management is very effective in anticipating and solving problems very early on in the project lifecycle. It allows all the stakeholders to catch problems very early on in the project lifecycle. Based on these analytics, a decision can be made to make adjustments and get the project on a positive path rather than creating higher scope creeps at every level of the project. This puts in greater flexibility for project managers to reduce the possibility of errors and increase team productivity as well.
#5. Important terms related to EVM – Understand them clearly!
a. Planned value – the planned value of any project determines the approved budget for work that has been scheduled to finish by pre-determined date.
b. Earned value – the earned value is the approved budget for work that has been completed by a specific date.
c. Actual Cost – this is a very important variable that needs to be checked at all times, as it shows the cost that has been incurred after the work has been completed on a specified date.
d. Schedule Variance or SV – This is another important variable whilst checking on the schedule as it shows the difference the work that is accomplished against the work that was supposed to be accomplished in that time-frame.
e. Cost Variance or CV – In simplicity, cost variance is the deviation of the amount that has been spent to the amount that was actually set to complete a project.
f. Schedule Performance Index or SPI – This is a variable term that determines the ratio between the budget that is actually been spent for work performed to the budget that was approved in the beginning of the project.
g. Cost Performance Index or CPI - This shows the ratio of the approved budget for work performed to the budget that was actually spent to execute the project.
Looking at the above-mentioned terminology, it can be seen how robust this technique is for project managers to set a relation between work, time, and money.
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