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earned value

Also called: EV

The budgeted value of the work actually done: each task's full budget multiplied by the share of it completed. Compared with planned value it shows whether you are behind schedule, and compared with actual cost whether the work costs more than planned.

Earned value is the budgeted value of the work actually done. For each task or line of work, multiply the full budget of that task by the share of it that is complete, then add up. A task budgeted at 120,000 and 70 % done has earned 84,000, whatever has been spent on it so far.

It is one of three numbers in a lightweight progress check. Planned value is the budget of the work that was scheduled to be done by now. Actual cost is what has really been spent. Comparing money spent with money planned says nothing about progress; earned value supplies the missing piece. Two ratios follow: earned ÷ planned (often called SPI) below 1 means less work is done than planned, and earned ÷ actual (CPI) below 1 means each unit of money buys less work than budgeted.

If the remaining work continues at the same cost rate, a rough forecast of the total is the full budget ÷ CPI. Treat that as a signal, not a verdict: find where the gap is, re-estimate what is left, and say what you will do. The schedule ratio is measured in money, so it does not tell you whether the critical path is late; check that separately.

The weak spot is the share complete. It should come from the task owner against something checkable (chapters accepted, questions reviewed), not from hours worked or a feeling of "almost done". Once a month, three numbers and one sentence on the cause are enough.

Example

Klasna's physics launch on Monday 30 November 2026. Work budget 510,000 UAH; planned cash for October and November 45,000 + 160,000, so planned value = 205,000.

Line
Full budget
Done
Earned value
Spent
Curriculum
120,000
70 %
84,000
95,000
Practice sets
90,000
20 %
18,000
20,000
Tutor selection
45,000
40 %
18,000
16,000
Diagnostic test
85,000
40 %
34,000
52,000
Landing page and booking
70,000
25 %
17,500
18,000
Marketing before opening
100,000
0 %
0
0
Total
510,000
171,500
201,000

Spending (201,000) looks close to plan (205,000), but:

  • earned ÷ planned = 171,500 ÷ 205,000 = 0.84: about 84 % of the work planned by now is done;
  • earned ÷ actual = 171,500 ÷ 201,000 = 0.85: each hryvnia bought about 85 kopiykas of planned work;
  • forecast at this rate: 510,000 ÷ 0.853 ≈ 597,726 UAH, more than the 560,000 the lead controls.

The usual mistake is on the diagnostic test: 40 % of the 52,000 spent gives 20,800. The right figure is 40 % of its full 85,000 budget = 34,000, and 34,000 ÷ 52,000 = 0.65 shows where most of the overrun sits.

Common mistakes

  • Multiplying by money spent. Earned value is the share done × the task's full budget, never × actual cost or × the plan to date.
  • Comparing only spent with planned. Spending can match the plan while the work falls behind; you need all three numbers.
  • "Almost done" as a percentage. The share complete should rest on something checkable, such as chapters accepted.
  • Treating the forecast as a verdict. A ratio is a signal: find the line behind it and re-estimate what is left.
  • Reading the schedule ratio as the critical path. It is in money; a critical task can be late while the ratio looks fine.

Learn it in the course

  • A budget over time with a reserve · Spread the 600,000 UAH ceiling over the months, keep a contingency reserve for named risks and a management reserve for surprises, and run one earned value check correctly.