Planned Value (PV)
Planned value (PV) is a concpt used in project management to describe the estimated cost of the work that should have been done at a certain point in time, based on the project schedule and budget. It shows the value of the work that was supposed to be done up to a certain date or milestone, no matter how much work was actually done or how much it cost.
Planned value is also called the budgeted cost of work scheduled (BCWS) because it shows how much the work that is scheduled to be done during a certain time period is expected to cost.
The project manager will usually use a project schedule and budget to figure out how much work should have been done at a certain point in time and then assign a value to that work based on the project budget. This is how the planned value of a project is calculated. This lets the project manager keep track of how the project is going compared to the plan and find any changes or delays that may need to be fixed.
Planned value is an important metric in project management because it gives a starting point from which to measure actual progress and costs. By comparing the planned value to the actual value of the work done and the actual costs, project managers can figure out if the project is on track, behind schedule, or over budget and take corrective action if needed. It can also be used to figure out earned value and cost variance, which are both important project metrics.
Usage
It is used in project planning
Related Posts:
- Fixed Price Incentive Fee Contract (FPIF)
- Expected Monetary Value (EMV)
- Estimate to Complete (ETC)
- Earned Value Analysis (EVA)
- Earned Value (EV)
- Critical Path Method (CPM)
- Cost Variance (CV)
- Cost Plus Award Fee Contract (CPAF)
- Cost Performance Index (CPI)
- Cost of Quality (COQ)
- Actual Cost (AC)
- Schedule Performance Index (SPI)