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Earned Value (EV) is the value of physically completed work at originally budgeted rates. Comparing this with Planned Value (PV), i.e. the work that should have been completed as of current date according to original plan, one can see whether work is going according to schedule. And comparing EV with Actual Costs (AC) for the work completed so far indicates whether there has been a cost overrun or not.

Project Management through Earned Value

The key requirements for applying EVM to project management are:

• A project management plan that includes a list of tasks involved in the project and scheduled completion dates
• Assigning a value to all the tasks involved (PV)
• Specifying rules for computing EV as the work progresses

Though PV and EV can be expressed in dollars, it is not compulsory (though convenient). For small projects, they can be assigned points values, e.g. Task 1 has a point value of 10.

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