Monitoring of Time and Cost Variances of Schedule Using Simple Earned Value Method Indicators

Abstract

The Planning and implementation of construction projects are difficult processes and are burdened with many risk elements. The budget spread over time, which is developed on the basis of the schedule, presents the expected distribution of costs throughout the duration of the works, which during the implementation of the project is subject to constant changes resulting from time, cost, and organizational factors. Managing construction contracts requires managers to be able to analyze on an ongoing basis the variances of production costs-from the values calculated in the offer cost estimate and assumed in the Budgeted Cost of Work Scheduled. The article attempts to analyze the emerging time and cost deviations using proprietary time variances from the schedule (T/S) and variances from planned costs (T/C) monitoring, based on simple indicators of the earned value method (EVM). An example of construction of a multi-family housing development was used to study the variances of planned and incurred costs.

Forecasting the Course of Cumulative Cost Curves for Different Construction Projects

“…The Earned Value Method allows for the control of the progress of project implementation in terms of its scope, cost, and duration [25]. This method involves comparing the planned (scheduled) progress of the work (scope) with the planned and actual time (schedule) and cost (budget) [26].…”

Challenges and opportunities of completing successful projects using Earned Value Management

“…Earned value management in project management is a methodology that integrates cost, schedule, and scope to gain a better understanding of how to measure project performance (Bagherpour et al, 2020). Project management includes the planned and actual values that allow managers, who use EVM, to predict the opportunity for projects to complete on time and within budget (Przywara & Rak, 2021).…”

Predicting construction cost under uncertainty using grey-fuzzy earned value analysis

“…Errors and uncertainty arise as a result of subjectivity in measuring PC, but they can be eliminated by employing linguistic variables [ 15 ]. PV is determined prior to the start of the project, whereas EV and AC are determined while the project is being executed and can only be determined until the status date [ 16 ]. Many applications in the real world are imprecise, vague, and ambiguous [ 17 ].…”