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What is Earned Value? Earned Value is an objective measurement on how much work is done on a project. Earned Value, Performance Measurement, Management by Objectives, and Cost Schedule Control Systems are synonymous terms. The use of either manufacturing standards or a Line-of-Balance methodology for measuring accomplishment on the factory floor is an earned value process. Earned Value improves on the normally used spend plan concept (budget versus actual incurred cost) by requiring the work in process to be quantified. Using the earned value process, members of management can readily compare how much work has actually been completed against the amount of work. Earned Value requires the project manager to plan, budget and schedule the authorized work scope in a time-phased plan and the time phased plan is the incremental planned value culminating into a performance measurement baseline and as work is accomplished. Earned Value compared with planned value provides a work accomplished against plan and a variance to the plan is noted as a schedule or cost deviation. Planned Value, Earned Value, and Actual Cost data provides an objective measurement of performance, enabling trend analysis and evaluation of cost estimate at completion within multiple levels of the project. Project management should be applied to every project where the owners of the final product wish to ensure that the expended resources were used efficiently. On major projects the application of good project management tools will aid in the selection of the right course when managers need to make financial and time allocation decisions. The Task Plans, which are linked by using Apportion Effort EVT, are essentially a master task plan and a slave task plan.
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