Unformatted text preview: produce manually for a large project. Fortunately, project management systems exist that produce these kinds of reports automatically, just as we have scheduling systems that produce scheduling charts automatically. What we need to discuss now is how the project manager uses the Earned Value Report in conjunction with the Cost and Schedule Variance Report. While it is possible to make updates to the actual expenditure, progress, and variance transactions at any time using the Modern Project transaction entry/edit tools, thereby affording the ability to continually update the Earned Value Report, it does not usually happen this way on a real project. The various project monitoring transactions are usually entered into the system on a periodic basis that agrees with the project reporting cycle. Cost accountants work from time-sheet summaries and other data sources that tend to be periodic in nature. So the project manager customarily gets an update of the Earned Value Report weekly or monthly. In the fortunate situation where the earned and actual curves are tracking the baseline curve closely, there is nothing Page 113 for the project manager to do in the way of taking corrective action. The project manager's time can then be spent on the host of other project management responsibilities, such as team building, optimizing project logistics, or optimizing the project schedule. In the case where either the actual expenditure curve or the earned value curve is not tracking the baseline curve closely enough, the project manager needs to evaluate what is causing this situation. The Cost and Schedule Variance Report is used to isolate the control packages that are causing this situation to occur. This process is explained in more detail in the next section. An important consideration for the project manager is the dissemination of this project performance data in the Earned Value Report and in the Cost and Schedule Variance Report. Many project management teams keep a close hold on project performance information, especially if it is negative. They fear possible repercussions from their management or from the client. But the author has found that wide dissemination of the project performance reports often contributes to the success of a project. If everyone on the project has a copy of the Earned Value Report and the Cost and Schedule Variance Report, everyone can see how everyone else is doing. With everyone's performance evaluation out in the open, there is a tendency for everyone to compete to have the best performance. Also, with the performance evaluation information out in the open, large performance fluctuations do not come as a surprise to higher levels of management because they can see the trends begin to unfold. In fact, if upper management is kept aware of the trend on projects, it may be able to direct additional key resources to the project to turn unfavorable trends around before they become unmanageable. In short, the competent project manager usually has nothing to fear and a lot to gain by wide dissemination of the project performance evaluation r...
View Full Document
- Spring '10
- Project Management, project manager