determine performance. It was only in 1962 that Earned Value was formally introduced on projects by the US Navy, as part of the development of the PERT/Cost methodology. In 1996, a new set of criteria were produced to encourage adoption in the private industry, by making the criteria more ‘user friendly’. The National Defense Industrial Association (NDIA) developed these 32 criteria and named it the Earned Value Management System (EVMS) criteria, currently embodied in ANSI/EIA
748. Finally, the Project Management Body of Knowledge (PMBOK), developed by the Project Management Institute, recommends utilizing a similar set of Earned Value criteria, as part of Project Cost and Project Communications Management (Performance Reporting).
B. Problem Definition
To measure the 3 dimensions described earlier for Earned Value Management, and apply them to a project, the following key values are required:
x Planned Value (PV): The budgeted cost for the work scheduled to be completed up to a given point in time. Formerly known as BCWS (Budgeted Cost for Work Scheduled).
x Earned Value (EV): The budgeted amount for the work actually completed during a given time period. Formerly known as BCWP (Budgeted Cost for Work Performed).
x Actual Cost (AC): The total actual cost incurred in accomplishing work during a given time period. Formerly known as ACWP (Actual Cost for Work Performed).
The PV, EV, and AC values are combined in various ways to provide project performance metrics [1]. EAC in time or cost could be calculated based on three variables: Budgeted Cost of Work Performed (BCWP), Budgeted Cost of Work Scheduled (BCWS) and Actual Cost of Work Performed (ACWP). ACWP is the total of expenditures that is consumed from the start until now and can generally be obtained via accounting documents. A simple