The video starts with an example.
A contractor was given a project to install 50 desktop machines for a client at USD 1000 in 5 days.
So the total contract is for USD 1000. The project manager analyzed and figures out that it requires USD 100 for 10 machines per day in 5 days.
Estimation of USD 100 per day makes the project cost as USD 500. USD 500 is the project cost baseline. The project cost baseline has nothing to do with what the contractor is getting. These are 2 separate conversations.
This is explained in a very simple language with the help of a Table.
The Table contains Day 1 to Day 5 as Rows and Plan value, Actual value and Earned value as columns.
On Day-1 you install 7 machines and actually spent USD 120, whereas planned was USD 100. So you can say that you have spent USD 120 against USD 100 and installed 7 machines against 10 machines.
But as per the plan, you were supposed to spend USD 10 per machine. Now earned value comes into the picture.
Earned value is a combination of actual quantity and planned rate. It is the terminology what is the worth of work completed against my budget.
Earned value = the value of work you have done=7 *10 = USD 70 on Day1
On Day1 we actually have done the work worth USD 70 whereas we have spent USD 120
Here Planned Value =USD 100, Actual Value=USD 120 and Earned Value= USD 70.
In simple language Earned value is the value of my completed work as per my cost baseline.
For variance and more details please enroll at: bit.ly/31xCwc2
The Project Management Professional (PMP), PMBOK, The Agile Certified Practitioner (PMI-ACP), and The Professional in Business Analysis (PMI-PBA) is a registered mark of the Project Management Institute, Inc.
PMBOK is a registered mark of the Project Management Institute, Inc.
Materials in this video are based on the text, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) - Sixth Edition, Project Management Institute Inc., 2017.
The PMI Registered Education Provider logo is a registered mark of the Project Management Institute, Inc.
For variance and more details please enroll at: bit.ly/31xCwc2
#PMP #EarnedValueManagementAnalysis📊 #iZenBridge