Earned Value Management (EVM) refers to the methodology with which management or the team responsible for project management enters into a project
, its terms of reference and the project plan. Earned Value Management is about adding value to the finished project, staying within budget and maintaining the earned value while using the resources needed and objectively evaluating the progress of the project. Performance
is determined by balancing budget and earned value against actual costs, relative to a key date. Project progress is determined by comparing the earned value on the key date with the planned and expected values. Earned Value Management recognizes three different EVM types: the Apportioned Effort, the Discrete E ffort and the Level of Effort. In Apportioned Effort, the effort of general activities is proportionally divided among the various Discrete Efforts. For example, in production, the costs for quality monitoring are apportioned to the various projects. The situation is different with Discrete Effort, where the planned activities are measured and evaluated against the work product or output. In Level of Effort, the third EVM type, no specific end product is produced. The activities and the associated effort are evaluated according to the time it takes to complete them.