A Brief History Of Earned Value
The PDF begins with a history of Earned Value “is a project management technique to measure, at a specific date, the progress and performance against the plan, and to estimate future performance.” This concept began in the 1890’s, the paper goes on, as a tool for industrial engineers to measure the performance of early factories.
In traditional projects (that is, physical engineering projects), scope is well understood and project work completes in a sequential, linear nature, allowing for Earned Value to occur at determined intervals:
Once the project is underway, actual performance data is collected and earned value analysis applied against the baseline plan at pre-defined points…Project managers utilize this information to monitor costs, and take action as required to correct the project course.
Scope changes are expected to be minimal, since the project scope is well thought out and the initial project planning stage. Scope changes are managed through a change control process. If there is a scope change, the plan is re-baselined.
The Difference With Agile
However, agile software projects don’t have those assumptions or understood scope. They require creativity, R&D and operate in a non-linear fashion. Using Earned Value Management directly will result in invalid results, though there are other options for tracking that can be used on agile projects which allow for insight and benefit. The paper includes the suggestions of Burn-up charts, Burn-down charts, and Cumulative flow diagrams. These, when used correctly, can provide insight into agile projects.
Read the full article here: http://leadinganswers.typepad.com/leading_answers/files/agile_and_earned_value_reporting.pdf