Cost Control of Construction Projects Through Earned Value Analysis

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Cost Control of Projects:
An Introduction to Earned Value Analysis
Earned value analysis is a method of performance measurement. Many project managers manage their project performance by comparing planned to actual results. With this method, one could easily be on time but overspend according to the plan. A better method is earned value because it integrates cost, schedule and scope and can be used to forecast future performance and project completion dates. It is an “early warning” program/project management tool that enables managers to identify and control problems before they become insurmountable. It allows projects to be managed better – on time, on budget.
Different traditional approach like performance
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This approach is most often used when current variances are seen as typical of future variances. 4. BAC modified by a performance factor, cumulative CPI. This approach is most often used when there are no variances from BAC. h) Estimate To Complete (ETC) – Difference between EAC and AC. This is the estimated additional cost to complete the project. i) Variance At Completion (VAC) Difference between BAC and EAC. This will show the project will be over or under budget.
Following are the summary for the important EVA terms and formula:

Table 1: Earned Value Analysis Terms

Table 2: Earned Value Analysis Formula and Interpretation
Effectively Implementation of Earned Value Analysis (EVA)
Different barriers was occurred when implement the earned value analysis into the project. They are a) Lack of comprehension of how the technique works; b) Anxiety concerning the adequate use of the tool; c) Use of the tool requiring a lot of work and time consumption; d) Tools trimming creativity in the use of other strategies; e) Inconsistency of the tool in managerial procedures/business processes; f) Method of control as threat, concerning the freedom of the team; g) Vague and inaccurate purpose and its benefit; h) High cost of its implementation; i) Unsuccessful prior experience in the use of other techniques; j) Low familiarity with the
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