Earned value management, commonly referred to as EVM, is a project management tool that combines
the cost, schedule, and scope information for a project into an integrated baseline. As the project
progresses, the team assesses how much work has been performed or earned against this baseline. The
resulting data is used to assess the past performance of the project and to predict the final cost and
delivery of the project based on the past performance.
Examine the following EVM data for the Acme project, a hypothetical construction project, to view
information on the past and future performance:
Cumulative planned value (PV) = 550
Cumulative earned value (EV) = 475
Cumulative actual cost (AC) = 525
Budget at completion (BAC) = 1000
After evaluating the Acme project, do the following:
1. Calculate the cost variance (CV), schedule variance (SV), cost performance index (CPI), and schedule
performance index (SPI). Using these four metrics, briefly explain whether the project is ahead or behind
for cost and schedule performance.
2. Using the results from the first question, calculate the Estimate at Completion (EAC) and Variance at
Completion (VAC). Analyze the results and explain whether the project is likely to overrun or underrun the
baseline plan and by how much.
Submission Requirements:
Submit your responses along with the detailed calculation in a Microsoft Excel spreadsheet. Make sure
that you include formulas in the spreadsheet so that calculations can be checked. Your analysis of the
data can be included at the bottom of your calculations or submitted in a separate Microsoft Word file.
