Comments on: Why Not Measure Earned Value? http://www.pmhut.com/why-not-measure-earned-value Fri, 25 May 2012 03:55:07 +0000 http://wordpress.org/?v=abc hourly 1 By: Glen B. Alleman http://www.pmhut.com/why-not-measure-earned-value/comment-page-1#comment-1156 Glen B. Alleman Fri, 10 Apr 2009 02:09:44 +0000 http://www.pmhut.com/why-not-measure-earned-value#comment-1156 Johanna, You might be confusing "business value" with the Budgeted Cost for Work Performed (BCWP), the "earned value," of ANSI/EIA-748B Earned Value Management. Earned Value (BCWP) is calculated in a brutally simple manner. At the time of assessment, BCWP = BCWS (Budgeted Cost for Work Scheduled) x Physical Percent Complete. How much did we plan to accomplish? How much did we accomplish? This requires that the Budgeted Cost for Work Scheduled (BCWS) be defined before starting the work. This means "what will we budget for this work at the time we want to assess the progress?" This is the "all in budget" for the work, based on a specific time of assessment - say the end of the iteration, the completion of the work package or the like. A simple – simple means notional, and notional means not that all realistic, but informative – training deck can be found at http://www.niwotridge.com/PDFs/EVMSCookies.PDF. At this point in time the "earned value" is that number times the percent complete. Words like "true earned value," or "I have not worked on projects where it is possible to calculate earned value," leads me to believe this is not the same "earned value," used on 100's of billions of dollars of software intensive projects in aerospace and defense. Scott Ambler has written recently in similar terms, confusing business value with 748B Earned Value. he is dead wrong of course, but this notion is spreading. Time to deal with this massive misconception of EV and software projects. Start with a few resources: http://www.stsc.hill.af.mil/crosstalk/2000/12/lipke.html http://www.askprocess.com/Articles/UsingEV1.pdf http://www.askprocess.com/Articles/UsingEV2.pdf McConnell has an entire course on this topic http://www.construx.com/Page.aspx?nid=15&id=37 Buy Paul's book (a colleague) and read it for guidance of applying EV to software intensive projects. http://www.amazon.com/Performance-Based-Earned-Value-Practitioners-Solomon/dp/0471721883 Things like the $600M avionics suite for the Orion manned space craft, our Paul's last project, the B2 avionics suite. Paul's work started some time ago, http://www.testablerequirements.com/Articles/solomon.htm With these materials "under your belt" so to speak, the notion of EV may be clearer as it is applied to software intensive projects. Glen B. Alleman VP, Program Planning and Controls Aerospace and Defense Denver, Colorado Johanna,
You might be confusing “business value” with the Budgeted Cost for Work Performed (BCWP), the “earned value,” of ANSI/EIA-748B Earned Value Management.
Earned Value (BCWP) is calculated in a brutally simple manner.
At the time of assessment, BCWP = BCWS (Budgeted Cost for Work Scheduled) x Physical Percent Complete. How much did we plan to accomplish? How much did we accomplish?
This requires that the Budgeted Cost for Work Scheduled (BCWS) be defined before starting the work.
This means “what will we budget for this work at the time we want to assess the progress?” This is the “all in budget” for the work, based on a specific time of assessment - say the end of the iteration, the completion of the work package or the like.
A simple – simple means notional, and notional means not that all realistic, but informative – training deck can be found at http://www.niwotridge.com/PDFs/EVMSCookies.PDF.
At this point in time the “earned value” is that number times the percent complete.
Words like “true earned value,” or “I have not worked on projects where it is possible to calculate earned value,” leads me to believe this is not the same “earned value,” used on 100’s of billions of dollars of software intensive projects in aerospace and defense.
Scott Ambler has written recently in similar terms, confusing business value with 748B Earned Value. he is dead wrong of course, but this notion is spreading.
Time to deal with this massive misconception of EV and software projects.

Start with a few resources:
http://www.stsc.hill.af.mil/crosstalk/2000/12/lipke.html
http://www.askprocess.com/Articles/UsingEV1.pdf
http://www.askprocess.com/Articles/UsingEV2.pdf

McConnell has an entire course on this topic
http://www.construx.com/Page.aspx?nid=15&id=37

Buy Paul’s book (a colleague) and read it for guidance of applying EV to software intensive projects.
http://www.amazon.com/Performance-Based-Earned-Value-Practitioners-Solomon/dp/0471721883
Things like the $600M avionics suite for the Orion manned space craft, our Paul’s last project, the B2 avionics suite.

Paul’s work started some time ago,
http://www.testablerequirements.com/Articles/solomon.htm

With these materials “under your belt” so to speak, the notion of EV may be clearer as it is applied to software intensive projects.

Glen B. Alleman
VP, Program Planning and Controls
Aerospace and Defense
Denver, Colorado

]]> By: PotPeyProject http://www.pmhut.com/why-not-measure-earned-value/comment-page-1#comment-1154 PotPeyProject Tue, 10 Mar 2009 18:09:56 +0000 http://www.pmhut.com/why-not-measure-earned-value#comment-1154 If you can not measure earned value you can not control your costs. Very simple. If you can not measure earned value you can not control your costs. Very simple.

]]> By: Steve Waddell, PMP http://www.pmhut.com/why-not-measure-earned-value/comment-page-1#comment-1155 Steve Waddell, PMP Fri, 06 Mar 2009 13:11:32 +0000 http://www.pmhut.com/why-not-measure-earned-value#comment-1155 You obviously have never done earned value right, on IT projects of any magnitude. When I worked for Northrop Grumman IT, we used earned value religiously for all medium and large IT projects (we had a scorecard used to determine project size based on man-hours, budget, and level of risk involved in the project). Most of these projects fell somewhere between $400k - $1.5m and usually completed within 1 calendar year, although some were larger. Using CPI and SPI to measure performance allowed us to gauge our progress along the way and to take corrective actions when necessary. Keys to success included proper planning (developing a resource loaded MS Project Schedule that typically had no more than 8-80 hours per task), regularly scheduled/accurate reporting by project team members, strong project management leadership, etc. Did EVERY single project come in on budget and schedule because we used EV? No, but typically that was due to poor requirements or scope creep, not EV, a topic for another discussion. You obviously have never done earned value right, on IT projects of any magnitude. When I worked for Northrop Grumman IT, we used earned value religiously for all medium and large IT projects (we had a scorecard used to determine project size based on man-hours, budget, and level of risk involved in the project). Most of these projects fell somewhere between $400k - $1.5m and usually completed within 1 calendar year, although some were larger.

Using CPI and SPI to measure performance allowed us to gauge our progress along the way and to take corrective actions when necessary. Keys to success included proper planning (developing a resource loaded MS Project Schedule that typically had no more than 8-80 hours per task), regularly scheduled/accurate reporting by project team members, strong project management leadership, etc. Did EVERY single project come in on budget and schedule because we used EV? No, but typically that was due to poor requirements or scope creep, not EV, a topic for another discussion.

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