I feel doubtful on the effectiveness of earned value concept in practice for some basic reasons below:
1. In EPC Projects, most of works are in lump-sump contract b/w main contr and vendors or subcontrs, so working budget are fixed. EV and AC will always have same value anytime and there will no CV and EAC. Earned Value concept doestn’t works well in this case.
2. In my opinion, EV concept requires a very detailed planning (level 5) in order to create a reliable baseline. You can’t judge this is over-run or delay while the baseline is bias. It means you will have a unique cost distribution curve for each activities and, it is really not practical.
3. Enforce to make cost based activities in a complex schedule is not easy because it’s not easy to merge schedule WBS with Cost Account Codes.
I still stand that schedule and cost should be in separate system. I understand that there should be some interface b/w them but not as ideal as EV concept mention.
1. In EPC Projects, most of works are in lump-sump contract b/w main contr and vendors or subcontrs, so working budget are fixed. EV and AC will always have same value anytime and there will no CV and EAC. Earned Value concept doestn’t works well in this case.
2. In my opinion, EV concept requires a very detailed planning (level 5) in order to create a reliable baseline. You can’t judge this is over-run or delay while the baseline is bias. It means you will have a unique cost distribution curve for each activities and, it is really not practical.
3. Enforce to make cost based activities in a complex schedule is not easy because it’s not easy to merge schedule WBS with Cost Account Codes.
I still stand that schedule and cost should be in separate system. I understand that there should be some interface b/w them but not as ideal as EV concept mention.