Earned Value Analysis

Resource: Project Management: The Managerial Process, Ch. 13 and Electroscan, Inc. Student Table spreadsheet

 

Evaluate the Earned Value Management (EVM) Case Study found on p. 499 in Project Management: The Managerial Process, Ch. 13.

 

Case Study

 

Tree Trimming Project

 

Wil Fence is a large timber and Christmas tree farmer who is attending a project management class in the fall, his off season. When the class topic came to earned value, he was perplexed. Isn’t he using EV?

 

Each summer Will hires crews to shear fields of Christmas trees for the coming Holiday season. Shearing entails having a worker use a large machete to shear the branches of the tree into a nice, cone shaped tree.

 

 

 

 

 

Will describes his business as follows:

 

 

 

  

I count the number of Douglas Fir Christmas trees in the field (24,000).

 

  

Next, I agree on a contract lump sum for shearing with a crew boss for the whole field ($30,000).

 

  

When partial payment for work completed arrives (5 days later), I count or estimate the actual number sheared (6,000 trees). I take the actual as a percent of the total to be sheared, multiply the percent complete by total contract amount for the partial payment [(6,000/$30,000 = 25%), (.25 × $30,000 = $7500)].

 

  

Is Will over, on, or below cost and schedule? Is Will using earned value?

 

  

How can Will set up a scheduling variance?

 

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