Earned value method

Earned value is a time-phased method to measure the project performance. The planned work is compared with the completed work to determine if project costs and schedules are within the budget. This method is usually contrasted with more conventional bottom-up performance measurement techniques.

You can use the earned value method to determine how budget amounts are to be released in these ways:

• Discrete Effort

  The ways in which you can use the Earned Value method of type Discrete Effort are:

  • Milestone

    Milestones are linked to the activity and a percentage or amount of the budget that is assigned to each milestone. Each time a milestone is reached, the assigned budget is released.

  • Start and End Percentage

    Percentage values are assigned to the start and end points of the activities. In other words, at the start of the activity, it is assumed that a specific percentage of the project is completed. Budget amounts are then released based on these percentages..

  • Percent Complete

    Budget amounts are released in proportion to the percentage progress of the project.

• Level of Effort

  Budget amounts are released in proportion to effort. This method is appropriate for time-driven activities where it is assumed that there is no discrepancy between the planned value and the earned value.

• Apportioned

  Apportioned efforts have an intrinsic performance relationship to some other discrete activity. Budget amounts are released in the same way as the discrete activity. The linked activity for the Earned Value must be other than type Apportioned.