The imperative nature of the triple constraints on project calls for a tracking and measuring method that project customers, stakeholders, and project teams must recognize. According to Dow and Taylor (2015) earned value analysis permits such a process; it displays continuously pertinent data in terms of time and cost rate (Dow et al., 2015). The information from the analysis is use to keep stakeholders and project managers aware of the project’s progress. They then in turn make decisions base off of the relayed information. Earned value reporting is indispensable to project management. The purpose of this paper is to discuss value analysis reporting in project management and stakeholders’ understanding of them.
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Establishing Estimate Value
To fully employ earned value analysis (EVA), project managers and stakeholders, but understand the standard lexicons of EVA such as earned value (EV), actual cost (AC), and (PV). The formulas are also standard such as cost variance, schedule variance, cost performance index, and schedule performance index (Dow et al., p. 207, 2015). Regardless if a project is large or small, earn value analysis reporting and the communication tools used to establish and report on them are advantageous to project managers and stakeholders.
The typical questions from stakeholders as pertain to projects are how much and when. Earned value analyses furnish that information in great detail. A manager must take into consideration the organization’s policies and procedures to get a full understanding of reporting value requirements. According to Nasr, Kuprenas, and, Diekmann (2000) post-project review is a substandard process for evaluating performance. A project manager should establish a timely process in order to address all phases of a project which will reduce costs (Nasr et al., …show more content…
A thorough work break down structure (WBS) will establish the full scope of work (Dow et al., 2015). Each work package activity should indicate the time, cost, and scope of the entire project collectively.
III. Reporting Value
According to Dow et al. (2015) the project management (PMO) office provides the best practices for project managers to use earned value analysis within the organization. Stakeholders expect continuous reporting on the project from start to finish. Depending on the stakeholders’ needs, the reports range from variances, performance, schedule, S-curve and forecasting. Understanding the variables and formulas as mention previously is important.
The simpler earn value reports are for stakeholders to understand, the better; however the report must be accurate. According to Larson and Gray (2013) determining earned value starts with the work package activities (Larson et al., 2013). As time goes by the opportunity to influence adverse trends in project management dwindles. Project managers must employ a continuous earned value reporting process for the benefit of the project.