Application of Earned Value Management in Project Management

Abstract

Today, firms may cut costs through improved information exchange and boost profitability by delivering goods more quickly and affordably with fewer resources thanks to the scientific use of project management. In these projects, the core management activities revolve around cost management. This requires project managers to follow a scientific approach to strict project budgets, identify deviations early, analyse problems and correct them in a timely manner. Therefore, this paper aims to introduce the meaning and methods of cost management and introduces the basic concept of earned value management after analysing the history and current status of cost management to optimize its theory. By analysing the interplay between project cost and schedule, this paper explains how to apply earned value management to project cost control process by using cost and schedule performance index analysis and so on. The paper concludes with an analysis of the limitations and some countermeasures and suggestions. Cost management of projects should take into account the variability of the project and take into account both time and quality factors.