Labor Costs

Some organizations substitute other measures than dollars for earned value (e.g., person-hours or person-days). The U.S. Navy does this and substitutes the terminology quantity (Q) for cost in the above acronyms. For reasons that will be clarified below, relating earned value only to labor provides a more useful operational measure.

Most projects have little trouble coming up with comparable BCWP and ACWP for direct-labor costs on a daily basis, sometimes with a little lag. Strict TOC

Time

Figure 8.9 Project budget, showing schedule and cost buffer.

Time

Figure 8.9 Project budget, showing schedule and cost buffer.

thinking identifies a problems with labor costs, first because labor is usually a relatively fixed operating expense and, second, because it includes overhead, and General and Administrative (G&A) mixes in meaningless allocations. But, as a progress tool, we can consider the unit of measure just as a comparative and not worry about these details. A more serious issue lies ahead. Many projects and companies do have trouble with achieving comparable values for material costs.

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Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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