Project 2010 Bible

Chapter 15. Analyzing Financial Progress

IN THIS CHAPTER

• Understanding earned value

• Evaluating cost information

• Making adjustments during the project

When you analyze the progress of your project, you must measure not only the progress of the schedule but also the progress based on the costs you incur. You do the latter by measuring the earned value of your project.

Understanding Earned Value

Earned value is the measurement that project managers use to evaluate the progress of a project based on the cost of work performed up to the project status date. When Project calculates earned value, by default it compares your original cost estimates to the actual work performed to show whether your project is on budget. You can think of earned value as a measurement that indicates how much of the budget should have been spent, when comparing the cost of the work performed thus far to the baseline cost for the task, resource, or assignment.

Note

You can calculate earned value by manually recording the Physical % Complete instead of letting Project calculate % Complete, which is Actual Duration divided by Total Duration.

To work with and use earned value information effectively for both automatically and manually scheduled tasks, you must first do the following:

• Assign resources and their costs to tasks in your project

• Save a baseline for your project

• Complete some work on your project

Understanding earned value fields

The fields that appear as headings in the Earned Value report you saw in Chapter 9 also ...