PMGT5820 Chap.7 Progress Monitoring and Earned Value
Progress Monitoring and Earned Value
Project control begins with a consistent status date and ends with an authorised response. This chapter distinguishes raw work-performance data, analysed information and decision-focused reports. It then uses planned value, earned value and actual cost to diagnose schedule and cost performance, while keeping forecasts conditional on explicit assumptions and dashboards focused on cause, trend, ownership and action.
Monitoring collects reliable observations; controlling compares them with the authorised plan, explains variance, evaluates alternatives and implements a response. Earned Value Management supports that comparison by putting planned work, completed work and actual cost on one budget-value basis at one date. Schedule and cost signals remain separate because favourable progress can coexist with inefficient spending.
Ratios scale the relationship, but they do not identify the operating cause. A forecast is a scenario whose assumption must be stated. Effective dashboards preserve the baseline, distinguish actual data from prediction and place a requested sponsor decision beside the evidence that makes action necessary.
What this chapter covers
- 01
Monitoring, controlling and the status-date boundary
- 02
Work-performance data, information and reports
- 03
Planned value, earned value and actual cost
- 04
Schedule variance and schedule performance index
- 05
Cost variance and cost performance index
- 06
Conditional estimates at completion
- 07
Dashboards, trends, thresholds and sponsor decisions
Worked example · free
Interpret mixed schedule and cost signals
- +1Calculate schedule variance as earned value minus planned value: positive $8,000.
- +1Calculate schedule performance index as earned value divided by planned value: 1.10.
- +1Calculate cost variance as earned value minus actual cost: negative $8,000.
- +1Calculate cost performance index as earned value divided by actual cost: approximately 0.92.
- +1State that the project is ahead on budgeted work but inefficient on cost at this date.
- +1Investigate whether acceleration, premium resources or rework caused the pattern before acting.
Key terms
- Status date
- The reporting cut-off to which all current performance observations and comparisons relate.
- Planned value
- The budgeted value of work scheduled to be complete at the status date.
- Earned value
- The budgeted value of work actually completed at the status date.
- Actual cost
- The recorded cost incurred for the work performed by the status date.
Progress Monitoring and Earned Value FAQ
Why must earned-value inputs share one status date?
The measures become comparable only when they describe the same reporting boundary. Combining a current cost record with an older completion estimate can produce precise-looking ratios that do not represent one project state. Confirm the cut-off before calculating or interpreting variance.
Does negative schedule variance mean a project is late by that amount?
No. Schedule variance is earned value minus planned value and is expressed in budget-value units. It shows that less budgeted work was earned than planned. Use the detailed schedule, milestones and dependencies to determine elapsed-time delay and its causes.
What should a sponsor dashboard show first?
Lead with baseline position, current schedule and cost status, trend, forecast, major risks or issues, owned actions and explicit decisions requested. Keep task-level evidence available behind the summary. A colour or ratio without cause, threshold and action does not complete the control conversation.
Assessment move
Practise earned value in a fixed sequence: record the status date, identify PV, EV and AC, write each formula, calculate, label the unit and interpret the direction. Then move beyond arithmetic by naming a plausible operational cause, the additional evidence needed and an authorised response. Redesign sample dashboards so every prominent visual supports a decision, action or awareness need.
Build a four-case calculation sheet covering ahead and under budget, ahead and over budget, behind and under budget, and behind and over budget. For each case, calculate schedule variance, cost variance, schedule performance index and cost performance index before writing any overall judgement. Translate the signs and ratios into separate schedule and cost sentences.
Remember that schedule variance is expressed in budget-value units, so use the detailed activity network to investigate elapsed-time delay. Add a budget at completion and compute a conditional estimate only after stating whether current cost efficiency is assumed to continue or remaining work is expected to follow the original rate. Challenge the result with a different assumption.
Next, convert the analysis into a sponsor view containing status, trend, cause, forecast, risk, owner and decision requested. Remove any chart that does not change action or awareness. Keep the source schedule, cost record and status date available so the summary remains auditable. Rehearse explaining why a baseline cannot be moved merely to eliminate an unfavourable variance.
End each exercise by identifying the operational evidence needed to choose among correction, prevention, authorised change or no action. Verify that every displayed measure shares the same reporting cut-off before comparing trends or calculating a forecast from mixed extracts.
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