In this article we will give you an overview of the changes that have been made in the new standard of Earned Value Analysis, AS4817-2019 as compared to the old standard AS4817-2006.

In August this year, the updated Australian Standard for Performance Measurement using Earned Value (AS4817-2019) was released. Overall the changes are minor in terms of the contents, however, there is a radical change in the perspective of Earned Value Analysis (EVA). In the previous standard, EVA was considered as “a tool” to measure the performance of a project or a program, whereas in the new standard EVA is considered a methodology to manage a project or a program.

In our view this is a quantum leap as a methodology is very different from a tool. 

Scope

The first major difference is in the naming of the standard. The name of the previous standard was "Project performance measurement using Earned Value" whereas the new standard is called "Earned value management in project and programme management". The 2006 standard considers Earned value as a measurement tool whereas the 2019 standard considers it a guidance for the practice of Earned Value management.

It is obvious from the name change that the scope of the standard has been broadened and it is no more a measurement tool rather it’s a management methodology, implying that it impacts all the phases of project/program management.

Normative References

Readers of the new standard will possibly note the lack of normative references (ie, you shall) making it less of a directive and more of a guidance standard.

Terms, definitions and abbreviated terms

There have been numerous updates to the definition of terminologies. For example the term Budget is removed as a defined term in the 2019 version and a split between time-phased and undistributed is noted. 

Overview of Earned Value Management

In the previous 2006 version, Earned Value is defined as a measurement tool whereas in the new standard it is a "structured method used to provide a perforamnce measurement system" for performance review at the project or programme level.

The revised standard forces Earned Value Management to extend beyond the three aspects of scope, cost and time integration, focusing on embedding and integrating  other aspects of the project controls philosophy including as communication of project status, corrective action facilitation and a common framework and vocabulary.

The new standard provides guidelines for Earned Value Management Systems, Earned Value Management Planning, and Using Earned Value measurements and performance metrics.

Earned Value Management Process Steps

The new standard guidelines include a much cimpler flow chart to celarly articulate the concept of 'plan the work and work the plan' as opposed to the previous version where this common pass phrase was simply referred to as 'planning, execution and control'.

Earned Schedule

The new version of the standard also outlines the possible application of Earned Schedule which can be run in parrallel to the Earned Value approach. Contained within Annex B of the standard is a high level overview of what ES is and how to apply it.

 

Overall the standard has been refreshed to accommodate todays project 'language' and to assist project teams in implementing earned value management practices and processes on both projects and programmes. 

Not every organisation is the same and implementation of an EVMS is, in the real world, typically based on system limitations and company frameworks. The revised standard enables organisations to tailor their approach to earned value implementation in a much less prescriptive manner, allowing for flexibility given their project management and ERP system constraints.

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