Published here December 2004.

Explanatory Preamble | Brenda Originally Wrote
Louise Responds | Frank Chips In | Kathy … | Quentin Responds
Brenda Tries to Summarize | Max Comments | Glen Responds

Max Comments to Glen Alleman


Personally, I think that EV is a thing that is over-hyped. Some form of EV is essential to know where you are relative to where you planned to be. The presumption here is that the plan is realistic and achievable as it stands. How often is that? Next, if you compare EV period on period, then you know how fast you are traveling and, more importantly, the rate of change of the progress - how many organizations actually show that increment on their reports and compare it with previous increments?

But EV does not tell you anything about where you are going, how you will get there, and most importantly when and for how much. That's where a completely separate exercise is required (i.e. re-forecasting, especially when it comes to projecting the final cost). And in my experience, that's where most organizations fail.

So EV is a poor predictor of the final time and cost, the issues that management are most interested in. I am not sufficiently acquainted with the most recent developments in the application of EV to know whether results these days have actually improved, but I am not confident that more and more is necessarily better and better. It seems to me that the problem is fundamental. So in terms of management's interest in the project's final time and cost, the problem is that we simply do not know, and cannot predict mathematically, the shape of the progress "S" curve out beyond time now.

In my view, the real solution is a less-frequent (perhaps 3-monthly) total re-estimate of all known outstanding work to completion and adding that to the cost of all the work done to date in order to get the final cost total as the base for determination of % complete. An added complication is that it is sometimes difficult to assemble "all the costs to the prescribed cut-off date", especially where financial accounting systems do not recognize payments until disbursements are actually cleared.


Brenda Tries to Summarize  Brenda Tries to Summarize

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