By Steve Rizer
When senior leaders in construction projects support the use of the earned value management technique, and when that technique is implemented properly, “it enables owners and contractors alike to have a strong command of performance and productivity problems, and mitigates the need for disputes.” This is one of the key messages that Synchrony Principal Laurie Bowman emphasized during a presentation that he helped deliver at AACE International’s Annual Meeting last month in New Orleans.
When “set up well,” an earned value management system can serve as a valuable communication tool on a project, providing information to stakeholders at different levels in different formats to suit their respective needs, Bowman and Synchrony colleague Mina Sabouri wrote in a paper accompanying the presentation. Toward this end, it is essential that “lower-level schedules and reporting tools (Levels 4 and 5) are vertically aligned with the Level 3 schedule so that progress rolls up seamlessly.” For an explanation of what these levels mean, visit page two of AACE International Recommended Practice No. 37R-06 at http://www.aacei.org/non/rps/37R-06.pdf). Furthermore, they stressed that detailed Level 3 schedules need to be vertically aligned with level 2 and Level 1 milestone schedules so that the data can roll up seamlessly and ensure consistency in schedule reporting at different levels.
“Different levels of stakeholders have different information needs to enable them to plan and make decisions for the future,” Bowman and Sabouri stated. “High-level management may be interested in high-level cost-performance summaries expressed in dollars and Level 1 milestone dates while project team leaders may be interested in cost and schedule performance and productivity reports and resource histograms expressed in full-time equivalent, helping them plan for future manpower requirements.” The authors further noted that frontline construction supervisors are likely to be more interested in quantity-tracking curves.
The ConstructionPro Network member version of this article includes additional details about Bowman's and Sabouri's presentation and information from three other presentations delivered at the annual meeting.