Do Duy Khuong Blog Primavera P6, Microsoft Project Tips & Tricks
How to use Earned Value Management in Primavera P6
Primavera support you to control project performance by Earned Value Management technique. I will show you how to use it in Primavera. We have a simple project to nish casting 10 column. 1 column / day. 100 $ / column Each activity is assigned resource A.
First we have to create baseline for this project. Go to Project -> Maintain Baselines. Click on Add and OK to create a baseline.
We will assign this baseline for our project.
Go to Project -> Assign Baselines. Click on Project Baseline and select our baseline. Then click OK.
We can show columns as display in below picture to analyze Earned Value Management. Right click on Activity Table -> Column. Select columns in Earned Value group.
At the end of day 5 of the project:
How many column should have been built? (This is the Planned Value) The answer is 5 column (This value is automatically calculated by using Baseline we assign previously. Baseline said that Project’s duration is 10 days, today is 5th day, so 5 column should be completed) PV = 5 x 100 = 500 $
How many column have actually been built? (This is the Earned Value) We receive report from construction site and it said only 3 columns nish. (This is value based on the Performance % Complete which is equal to Activity % Complete by default)
EV = 3 x 100 = 300 $
How much did it cost to build those three column? (This is Actual Cost) We receive report from Accountant department and it said 200 $ / column. (This value is based on Actual Units) AC = 3 x 200 = 600 $
Then we can show “Schedule Variance” and “Cost Variance”.
Schedule Variance SV = EV – PV = 300 – 500 = -200 $
A negative number indicates that the project is behind schedule. 1 day for 1 column for 100 $. So it means we are late 2 days. Cost Variance CV = EV – AC = 300 – 600 = -300 $ A negative number indicates that the project is over budget. It means we are currently over budget 300 $.
Then we can show “Estimate to Complete” and “Estimate at Completion”
ETC = BAC – EV = 1000 – 300 = 700 $ EAC = ETC + AC = 700 + 600 = 1300 $
According to PMI standard, we should take CPI into account to calculate these 2 values. So we can change the way Primavera calculate by : Go to WBS window -> Earned Value tab. Check on PF = 1 / Cost Performance Index
Now ETC = ( CPI =
= =
= 1400 $
= 0.5 )
EAC = ETC + AC = 1400 + 600 = 2000 $
However you have to congure this option at the beginning of project (before update anything). Otherwise it doesn’t aect.
We can also make diagram report Click on Activity Usage Prole button.
Right click on the diagram and select Activity Usage Prole Option
Check in option as display in below picture
Now you can see the Earned Value diagram. You will use the cost axis on the right side (not the left one).
I also attach a theory diagram of Earned Value Management for your reference.
With Earned Value Management in Primavera we can easily see our project performance and forecast the total cost at the end of project.
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Related:
How Baseline Dates are calculated in Primavera P6 for Earned Value Management In "Earned Value"
How to update Baseline in Primavera P6
In "Primavera P6"
How to quickly identify Behind Schedule and Over Budget activity by Indicator UDF in Primavera P6 In "Layout / Report"
Author: Khuong Do Khuong Do is a Project Planner in Civil, Transportation and Oil & Gas Industry. He has worked as a Primavera Consultant Specialist since 2006 . He holds a Civil Engineering degree and a Bachelor of Information Management System. Now he is working in Petronas RAPID project, one of the biggest Renery and Petrochemical complex, in Pengerang – Malaysia. View all posts by Khuong Do
Khuong Do
25 thoughts on “How to use Earned Value Management in Primavera P6”
KH August 8, 2016 at 7:45 PM
Dear, Very nice. Really i always wait for the post. Please post HOW TO PREPARE RECOVERY SCHEDULE (Actual cost = plan cost) after delay or EOT) in other words bring plan % or cost equal to Earned Value. Like
doduykhuong August 9, 2016 at 8:18 AM
Hi, Thank you for your compliment. I will keep your suggestion in mind and I might do it in future Like
Mudassar Malik August 11, 2016 at 8:17 PM
Thanku very much sir Like
Padmanabhan September 21, 2016 at 2:57 PM
Hi, Appreciate the update on recovery schedule. Like
Mudassar Malik August 11, 2016 at 8:15 PM
Yes i have also some issue’s about it Like
Anonymous August 8, 2016 at 10:17 PM
Simple and well explained. Thanks for sharing.
Like
N.Balaji Prasada Rao August 9, 2016 at 8:28 AM
Dear sir, Excellent.Refreshed with simple example yet covered all the core topics in earned value concepts.Thanks for sharing. Like
Mayur August 9, 2016 at 4:29 PM
Explained a simple way.. Nice article.. Like
Evgeny August 10, 2016 at 12:25 PM
Thanks for the nice article. I have a question regarding ETC: What formula is used to calculate the ETC for each unit of time and draw the curve? Is this formula based on the PV?
Like
doduykhuong August 10, 2016 at 1:57 PM
Hi Evgeny, The value to draw the curve is also the value appear on the activity table (The Estimation At Complete column). The formula is based on what we choose in the Earned value tab. Do we consider CPI or not. Like
Doug August 10, 2016 at 11:06 PM
Nicely done, Do. Thank you for sharing. Like
Langston August 11, 2016 at 4:01 AM
Well done and straight forward example. Excellent layouts.
Like
Amir Syarifuddin August 11, 2016 at 9:04 AM
Thank you for your compliment. I will keep your suggestion in mind and I might do it in future Like
Anonymous August 12, 2016 at 7:21 PM
Thanks for sharing Like
BEDE August 12, 2016 at 7:23 PM
Thank you for sharing Like
M.Nabeel August 13, 2016 at 12:46 PM
Excellent work Like
Nelson August 14, 2016 at 3:12 PM
Simple and clear, well done. Like
PHH August 18, 2016 at 2:16 AM
Thank you, IOU a cup of coee!! Like
I Ahmed September 22, 2016 at 2:42 AM
Explained in a simple way and thanks for sharing. Like
Petrit Kanina October 18, 2016 at 3:11 AM
Thank you for useful explanation of EV. Everything about EV now are very clear. Can you share this explanations in pdf, please? Like
doduykhuong October 18, 2016 at 8:54 AM
Hi. In the “Share this” section, click on “More” button and you can see the Print button. Click on Print you can have the pdf version. Like
Anonymous April 27, 2017 at 5:15 AM
Hi, Great work Keep it up. Please share Primavera P6 Analytics installation steps. Many thanks Imran Like
Arita May 24, 2017 at 11:42 PM
Hi How to upload Cost in P6? I want to upload cost for Clients per tender value and for progress billing per month based on progress, not actual cost from Resources Like
Rolando B. Digamon July 5, 2017 at 2:21 PM
very straight forward…. Thanks Like
Mudassar Malik
July 26, 2017 at 7:42 PM
very simple method thank u Liked by 1 person
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