As much as organizations rely on earned value schemes to predict the success of their project, the scheme has some limitations that organizations can not accomplish using it. However, the advantages that companies get from implementing the structure over-weigh the limitation and this should not be a reason for them not using the scheme. Here are some of the limitations organizations are bound to experience when using Earned value management system.
The EVMs can be used to predict the project success prior to its commencement. This is due to the principles the model uses which have shown a positive correlation when it comes to project success. This helps management to predict with certainty the success of their projects thus allowing them to invest on projects which are successful.
It also helps organizations to easily break down their structure in terms of cost, work integration and scheduling. In cases where the company has different functional areas like manufacturing, engineering or accounting, use of product orientation can help coordinate and organize each department contributions while ensuring that cost, job and schedule are well integrated.
For the scheme to achieve its designed purpose the communication should be maintained in order to produce timely earned value management data. In case an organization has separate entities which do not work closely together the system will not work perfectly for them and may end up investing on a project that will never succeed.
When planning for projects, this EVMS predict the final cost of the whole project by use of the cost performance index that is CPI. This can help the management know whether that project will be successful or not according to the results they obtain before launching such a project. The system also helps organizations to measure how the venture is being carried out. They are in a position to check whether the activities that they had allocated to be accomplished within a given period of time have been achieved and if not, the system can draw some suggestions on how to reduce the chances of project derailment. This helps companies to determine whether the project will be successful or not.
The scheme does not track the progress but rather shows the percentage of completed job. This becomes very difficult for project managers to determine who is not performing their work as per their schedule. Also the scheme used by the organization may make implementation of the system very difficult.
As much as the use of the EVMS is highly recommended and help organization to predict the success of their projects, applying the system on a project that is in progress can have detrimental effects to the whole project. This can affect the organization, schedule, budget and the performance of the whole project.
The model takes earned value as the base line when predicting the values. However, the predictions may not be accurate at times. This is due to some of the foreseen risks which may cause some delays. Basing the assumption on the planned figures can land organizations in to troubles. On the other hand, the idea requires software to be used for it to accomplish its goals. The cost of purchasing this software is high and that is why most managers do not prefer using the system since they are not able to know exactly whether the project is in good shape or not thus limiting its use.
The EVMs can be used to predict the project success prior to its commencement. This is due to the principles the model uses which have shown a positive correlation when it comes to project success. This helps management to predict with certainty the success of their projects thus allowing them to invest on projects which are successful.
It also helps organizations to easily break down their structure in terms of cost, work integration and scheduling. In cases where the company has different functional areas like manufacturing, engineering or accounting, use of product orientation can help coordinate and organize each department contributions while ensuring that cost, job and schedule are well integrated.
For the scheme to achieve its designed purpose the communication should be maintained in order to produce timely earned value management data. In case an organization has separate entities which do not work closely together the system will not work perfectly for them and may end up investing on a project that will never succeed.
When planning for projects, this EVMS predict the final cost of the whole project by use of the cost performance index that is CPI. This can help the management know whether that project will be successful or not according to the results they obtain before launching such a project. The system also helps organizations to measure how the venture is being carried out. They are in a position to check whether the activities that they had allocated to be accomplished within a given period of time have been achieved and if not, the system can draw some suggestions on how to reduce the chances of project derailment. This helps companies to determine whether the project will be successful or not.
The scheme does not track the progress but rather shows the percentage of completed job. This becomes very difficult for project managers to determine who is not performing their work as per their schedule. Also the scheme used by the organization may make implementation of the system very difficult.
As much as the use of the EVMS is highly recommended and help organization to predict the success of their projects, applying the system on a project that is in progress can have detrimental effects to the whole project. This can affect the organization, schedule, budget and the performance of the whole project.
The model takes earned value as the base line when predicting the values. However, the predictions may not be accurate at times. This is due to some of the foreseen risks which may cause some delays. Basing the assumption on the planned figures can land organizations in to troubles. On the other hand, the idea requires software to be used for it to accomplish its goals. The cost of purchasing this software is high and that is why most managers do not prefer using the system since they are not able to know exactly whether the project is in good shape or not thus limiting its use.
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