SECOND EDITION
By Wayne F. Abba
Michigan, USA
Abstract
Earned Value Management (EVM) has been part of Department of Defense (DoD) acquisition policy for 50 years, remains an essential part of that policy, and is growing internationally. EVM’s longevity is discussed from the unique perspective of one who led that evolution as a public servant in the Office of the Secretary of Defense (OSD) for many years and is helping to define its newest form — Integrated Program Performance Management (IPPM).
Background
After a half century, anyone familiar with DoD acquisition policy for major programs should understand EVM principles. If not, the literature is extensive. For an excellent explanation and history, see Fleming and Koppelman, EARNED VALUE Project Management. [1] The authors traced EVM’s origins back to industrial management processes from more than a century ago and noted that, as a matter of Defense policy, nothing substantive had changed in its first four decades. That remains true today.
EVM’s longevity is attributable to its nonprescriptive nature and its holistic, integrative approach to industrial management. The EVM pioneers did not tell the industry “how to manage” but rather defined a set of mandatory, scalable criteria for industrial management. Those criteria, now referred to as “guidelines,” have proved remarkably resilient because they relate to underlying essential management concepts such as defining, organizing, scheduling and measuring work performance.
The other key EVM attribute, integration, refers to relationships between industrial management processes and project (or contract) work. Simply put, as a contractor extends the customer’s Work Breakdown Structure (WBS), EVM requires that all work is identified, budgeted and scheduled to the extent practicable. This disciplined planning makes possible the reliable measurement of project performance against a baseline and the ability to forecast the outcome.
The DoD Comptroller was the original policy owner for EVM. This proved to be a two-edged sword. While independence from engineering and acquisition disciplines allowed EVM to establish itself, the Comptroller’s ownership identified it with financial management and reporting. Indeed, the first DoD EVM policy was called “Cost/Schedule Control Systems Criteria” (C/SCSC or CS2) and was issued in 1967 as a DoD instruction in the Comptroller’s 7000 series. There was an accompanying instruction for reporting.
It was many years before responsibility for EVM was transferred to the Office of the Under Secretary for Acquisition & Technology in 1989, and it was two more years before EVM was incorporated into the 5000 series in 1991.1 With EVM having proved itself over more than two decades, the transfer placed EVM in its proper context as the essential integrating management discipline for major acquisition programs. New management processes, notably the Integrated Baseline Review (IBR), were developed to improve contract planning and execution. The DoD Acquisition Reform era of the late 1990s further served to strengthen EVM.
More…
To read entire article, click here
Second Editions are previously published papers that have continued relevance in today’s project management world, or which were originally published in conference proceedings or in a language other than English. Original publication acknowledged; authors retain copyright. This paper was originally published in CrossTalk, March/April 2017. It is republished here with the author’s permission.
How to cite this paper: Abba, W. F. (2024). Modernizing Earned Value Management; Originally published in CrossTalk, March/April 2017; republished in the PM World Journal, Vol. XIII, Issue II, February 2024. Available online at https://pmworldlibrary.net/wp-content/uploads/2024/02/pmwj138-Feb2024-Abba-Modernizing-Earned-Value-Management-2nd-ed.pdf
About the Author
Wayne F. Abba
Michigan, USA
Wayne Abba is an independent consultant in program and project management. For 17 years before retiring in 1999, he was the senior program analyst for contract performance management in the Office of the Under Secretary of Defense (Acquisition & Technology). He was a volunteer expert advisor to the US Government Accountability Office team that published the “Cost Estimating and Assessment Guide: Best Practices for Developing and Managing Capital Program Costs,” and “Schedule Assessment Guide: Best Practices for Project Schedules.” He is (twice) Past President, College of Performance Management.
Semi-retired but still active, Wayne is currently a member of a Program Management Improvement Team advising the U.S. National Nuclear Security Administration’s Office of Safety, Infrastructure and Operations. He also serves on the board of the Graduate School Japan, a nonprofit organization that provides training and consulting services to Japan government ministries, including planning for management of the Fukushima nuclear plant decommissioning. His voluntary work with the National Science Foundation includes membership on several project review panels ranging from conceptual through final design reviews.
Wayne can be contacted at wayneabba@aol.com
