Wednesday, July 21, 2010

Time centric Earned Value

Some years ago, actually 13 years ago, Jim Sumara and myself gave a talk at the 1997 PMI Symposium in Chicago. The topic was "time-centric earned value", a practice we introduced at a commercial backoffice IT shop when we found the conditions for conventional earned value did not exist.

Jim and I both came from DoD backgrounds and had managed programs with EVM for years. But, of course, IT shops rarely embarace DoD practices. In particular, the portfolio of IT projects we were managing had a lot of participation from the functional side of the business for which there was no time accounting. People were simply assigned to projects 'for the duration'. And, the chart of accounts did not support project portfolios.

So, working with what he had, we came up with "time centric earned value". A relatively simple idea of assigning value to task starts and finishes, and then measuring the value earning of those events. The focus is on accomplishment, not effort.  The idea is to give credit only for a meaningful contribution to completing the project.  As given in the presentation, the key to success is defining the value--that is, establishing the criteria--that is the basis for sustaining a claim of accomplishment by the team.

The presentation is posted on slideshare.net.

Of course, there are other approaches to earned value that are unconventional by the ANSI definition.  Among others are 'throughput accounting' and 'work unit accounting'.  Some agile practices include a form of work unit accounting in their 'earn-burn' practice.

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2 comments:

  1. John, thanks for the post and the idea,

    I manage ERP projects, and I keep thinking about using EVM to measure project performance. As you mentioned, traditional EVM is focused on cost, while your alternative EVM - on the time factor. It is a great alternative.

    However, in many cases it is hard to define the most important factor throughout the project, therefore, both cost-centric and time-centric approach does not give an ultimate method for performance measurement.

    What I really learned from you slides is that the focus of EV must be on the core value of the project.

    I have thought about writing an article on EVM, hope I can soon :-)

    Son Nguyen
    http://pmreviews.org

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  2. Son: this technique was developed and used on a Peoplesoft ERP project. It worked well

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