EVM fuses scope, schedule and cost into one objective read of performance. Three measures — PV, EV, AC — produce two variances ($) and two indices (ratios). The golden rule: EV starts every formula; subtract for a variance, divide for an index, and positive / > 1 is good.
Visual Map — The EVM S-Curve
EV below PV ⇒ behind schedule; EV below AC ⇒ over budget. The vertical gaps to EV are the variances.
The Three Measures
PV — Planned Value
budgeted cost of work scheduled (the baseline plan). Total PV = BAC, Budget at Completion.
EV — Earned Value
budgeted cost of work performed. EV = % complete × BAC.
AC — Actual Cost
actual cost of the work performed — what you really spent.
Variances ($) & Indices (ratios)
SV = EV − PV + ahead · − behind
CV = EV − AC + under · − over
SPI = EV ÷ PV >1 ahead · <1 behind
CPI = EV ÷ AC >1 under · <1 over
Worked Example
Item
Value
BAC
$100k
PV (planned 50%)
$50k
EV (40% complete)
$40k
AC (spent)
$45k
SV = 40−50
−$10k behind
CV = 40−45
−$5k over
SPI = 40/50
0.80
CPI = 40/45
0.89
Exam Concepts
Variances in $, indices are ratios. EV is always first.
Positive variance & index > 1 = favourable.
EV = % complete × BAC.
SV weakness: measured in $, it drifts to 0 at the end even if late — pair it with the schedule network or SPI.
Cost pair uses AC; schedule pair uses PV.
Executive View
One integrated number for scope + schedule + cost.
Objective early-warning system — trends, not anecdotes.
CPI is famously stable after ~20% complete — trust the trend.
Reports up cleanly through program & portfolio.
Relationships
Needs a sound scope, schedule & cost baseline first (Poster 6 baselines).
Risk reserves sit inside/outside the baseline (Poster 12).
Forecasting (EAC/ETC/VAC/TCPI) builds on these — Poster 15.
Industry Example
Capital Project
A $100k line-upgrade is 40% built but has consumed $45k by the planned-50% point: SPI 0.80 & CPI 0.89 flag it behind and over early enough to act.
Memory Hooks
"EV is the hero — it opens every formula."
Variance = minus, Index = divide; + and >1 are good.
Cost↔AC, Schedule↔PV (C-A, S-P).
60-sec ReviewDefine PV / EV / ACWrite SV, CV, SPI, CPIEV = ? × BACWhy SV in $ is weakSketch the S-curve
PMI Visual Wall · Poster 14 · EVM — Measures, Variances & Indices · original instructional design · A3 landscape