Letter: EVM, Activity-Based Costing will reveal projects' problems

Regarding “Report identifies benefits, limitations of EVM,” I would disagree with Clinton Bass, an analyst of government organization and management at the Congressional Research Service’s Government and Finance Division, who concluded that "for example, even when EVM metrics are accurately captured and portrayed, the metrics typically will not reveal why a project might be experiencing schedule or cost variances.”

If earned value management is used with an Activity-Based Costing (ABC) accounting system, it will point out very clearly and concisely exactly where the problem lies. This is based on more than 35 years of firsthand experience using EVM as a general contractor.


More importantly for those projects funded by the World Bank, Asian Development Bank, U.S. Agency for International Development or other multi- or bilateral lending agencies, the use of EVM combined with ABC will help eliminate corrupt and collusive practices, by making the "leakage" of funds very difficult to hide.


Unfortunately, the most popular certifications being adopted by the government, the Project Management Institute's (PMI) Project Management Body of Knowledge Guide and Project Management Professional certification, fails miserably in making the clear link between EVM and the necessity of using ABC as part of that process.


In my professional opinion, the organization that bests explains this link is the Association for the Advancement of Cost Engineering.


Unfortunately, many information technology people have adopted the rather superficial approach PMI advocates, which has resulted in poor understanding of how EVM works and even less understanding on how to read and interpret the very simple graphics which result. 


Bottom line, if Bass would write to me, I would be happy to help him understand the essential link between ABC and EVM.


Dr. Paul D. Giammalvo, CDT, CCE, MScPM
Beijing


What do you think? Paste a comment in the box below (registration required), or send your comment to letters@fcw.com (subject line: Blog comment) and we'll post it.

Featured

  • Cybersecurity

    DHS floats 'collective defense' model for cybersecurity

    Homeland Security Secretary Kirstjen Nielsen wants her department to have a more direct role in defending the private sector and critical infrastructure entities from cyberthreats.

  • Defense
    Defense Secretary James Mattis testifies at an April 12 hearing of the House Armed Services Committee.

    Mattis: Cloud deal not tailored for Amazon

    On Capitol Hill, Defense Secretary Jim Mattis sought to quell "rumors" that the Pentagon's planned single-award cloud acquisition was designed with Amazon Web Services in mind.

  • Census
    shutterstock image

    2020 Census to include citizenship question

    The Department of Commerce is breaking with recent practice and restoring a question about respondent citizenship last used in 1950, despite being urged not to by former Census directors and outside experts.

Stay Connected

FCW Update

Sign up for our newsletter.

I agree to this site's Privacy Policy.