When to use it
A useful fit
Use it where scope, budget and completion rules are stable enough for meaningful comparison.
Know the limits
Do not claim cost efficiency if actual costs are unavailable or incomplete. A fixed-price supplier’s invoices are not necessarily its actual costs.
How to use it
- Agree the scope baseline and objective rules for crediting completed work.
- Collect planned value, earned value and actual cost on the same date and accounting basis.
- Investigate variances and use a forecast whose assumption fits the remaining work.
Worked example
A project has spent less than planned but has completed even less budgeted work. The delivery lead investigates progress and remaining work before calling the lower expenditure a saving. The linked tutorial demonstrates the arithmetic.
Illustrative scenario by fannarmaximus; not an official exam question.
Common pitfalls
A favourable spending variance can reflect unfinished work rather than efficiency.
Attribution & sources
Earned value developed through cost/schedule control practice. The series cites Peter Morris’s historical treatment; no single inventor is asserted.
The citations below identify authoritative references for this topic. They do not imply endorsement or reproduce the bodies’ competence lists.
- Morris, P. W. G. (2013). Reconstructing Project Management. Chichester: Wiley-Blackwell. ISBN 9780470659076. https://doi.org/10.1002/9781118536698
- Project Management Institute (2025). A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Eighth Edition, and The Standard for Project Management. Newtown Square, PA: PMI®. ISBN 9781628258295.