Planned Value in Project Management

Planned Value (PV) is a crucial Key Performance Indicator (KPI) in Project Management. It represents the budgeted cost of work that should have been accomplished according to the project schedule.

Planned Value helps project managers assess whether the project is tracking on schedule and budget. It also serves as a key input in calculating other essential project metrics like Schedule Variance and Cost Variance.

Calculation of Planned Value

Planned Value is generally pre-determined during the project planning phase, considering the budget allocated to each task based on the project schedule.

Here’s a conceptual representation of calculating Planned Value for a specific task:

Planned Value = Budgeted Cost of Work Scheduled

In this formula:

• Budgeted Cost of Work Scheduled refers to the budget set aside for the work planned to be completed by a particular time.

By tracking Planned Value, project managers can compare the planned cost against the actual cost and the earned value, helping to monitor cost performance and schedule performance of the project. This helps to identify potential issues early and allows for more effective project management.