Qeuestion of EVM

Submitted by Bryan on Thu, 04/26/2012 - 04:25

I'm reading PMBOK regarding the Earn value session, there have a sentence said

" The EV being measured must be related to the PV baseline (PMB), and the EV measured cannot be greater than the authorized PV budget for a compnent."

My concept is If EV greater than PV, more job is done, but why the EV cannot greater than PV? Anyone can explan to me the concept behind that. Thank you very much.

 

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projmanpro

Thu, 04/26/2012 - 06:54

You must understand well what is EV so that you can clear ur doubt. What is EV? The PMBOK defines it as "the value of work performed expressed in terms of the APPROVED BUDGET ASSIGNED TO THAT WORK for an activity or WBS component. I emphasized the phrase "APPROVED BUDGET ASSIGNED TO THAT WORK". This gives you now the understanding within this context why EV cannot be MORE than PV, as this is the same as saying that the EV is exceeding the approved budget assigned to that task. In principle, this scenario is causing risk to budget, and it shows a "bad planning" in fact.

You can follow my thread on www.pmptrend.com

 

Bryan

Thu, 04/26/2012 - 07:38

I'm still confusing because the SV = EV - PV if greater than 1 is good, but if the EV cannot greater than PV, then how come the SV greater than 1 is good?

projmanpro

Thu, 04/26/2012 - 10:38

Hi Bryan, i have expounded my explanation in this thread http://www.pmptrend.com/index.php/en/forum/11-Questions-Answers-Queries-Infos-Etc/70-Doubt-about-Earned-Value#70  check this out.