We track such things as Earned Value to see if the project is staying true to the budget and planned burn rate.
Project controls become even more important when changes occur as a result of unforeseen conditions, scope change etc. Any time there are unforeseen expenditures, we document the cause of the changes and who is responsible for the extra costs.
With this on-going measurement of the cost and completion schedule, we can advise the management team of any potential issues completing the project on time and / or within budget.
We apply earned value management to construction projects to supported the following objectives:
- Provide an accurate picture of project status
- Identify potential problem areas
- Create visibility and credibility
- Avoid surprises and crises
We achieve the objectives by following the basic components of Earned Value:
- Planned value (PV) or the Budgeted Cost of Work Scheduled (BCWS)
- Actual cost (AC) or the Actual Cost of Work Performed (ACWP)
- Earned value (EV) or the Budgeted Cost of Work Performed (BCWP)