Earned Value
Basic Elements of EVM
By: Ray Myers, Jr., PMP The basic elements of Earned Value Management (EVM) are: Planned Value (PV) PV is the planned, budgeted, or estimated cost for the work performed as of a reporting date. PV is calculated by multiplying the hourly rate times the number of hours planned to accomplish the work. PV = Hourly Rate x Total... »
Return on Investment
By: Ray Myers, Jr., PMP Return on Investment (ROI) is a measure of the profitability of a project or business investment. Net Benefit Compares benefit to cost of initiative = Benefit – Cost Benefit Cost Ratio Ratio for benefit returned for each dollar invested = Benefits / Costs Return on Investment % Percent in net benefits for every dollar invested = (Net Benefit /... »
Net Present Value
By: Ray Myers, Jr., PMP Net Present Value (NPV) is a measure of the net benefit of a project in terms of today’s dollars. NPV is a financial analysis technique that considers: Timing of cash flows Time value of money Projects with positive NPV add value to a firm, while projects with negative NPV diminish value and should... »
Project EVM Formulas
By: Ray Myers, Jr., PMP If you haven’t seen or used EVM formulas, you will at some point in your project management career and you will need to know these formulas to pass the PMP examination. EVM stands for Earned Value Management. Earned Value is a simple and easy to use method to quickly determine... »
ROI
By: Ray Myers, Jr., PMP Definition: Return on Investment, or ROI is a performance measure used to evaluate the net benefit of a project to the performing organization. ROI is usually expressed as a percentage. Every organization has a wish list of projects that they would like to be implemented, but funding and resource limitations usually... »
