The measurement and reporting of project progress is notoriously difficult. In the absence of a consistently applied methodology for planning and reporting, each project or programme manager is likely to adopt a different approach to the reporting of progress. Often, these reports are guesswork, based on subjective, frequently optimistic estimates from the project team. The cumulative effect of this guesswork across many projects can lead to gross under or over estimates of the actual situation of the business as a whole, with disastrous eventual effects on cash flow and budget forecasts.
Thus the benefits of adopting an Earned Value approach to progress measurement can be seen at many levels:
- For the project and programme managers, a justifiable and objective approach to reporting of progress
- For the management accountants and budget holders, a realistic approach to evaluation of progress and cash flows
- For the business, confidence in the contribution to effective internal controls of the project progress evaluation processes.
