The Classification of Work in Earned Value Management

Each Work Package Has Its Own Characteristics

In project planning, you have defined the project scope, created the work breakdown structure and specified the work packages in detail. Now, the work of the work packages will be classified. You have probably never done this before; however, in Earned Value Management this is important for progress evaluation, for calculating the Earned Values and determining project performance.

Each work package has its own characteristics; therefore, the project manager and the control account manager define the optimal method for measuring the progress of each WBS element. To accommodate the different types of work, there are several accepted methods to measure work performance. In Earned Value Management, project work is classified into three areas:

• Discrete Effort or Measurable Effort
• Apportioned Effort
• Level of Effort (LOE)

Each of these classifications has one or more measurement methods available and each method has its own characteristics of application to the work.

The easiest way to determine the degree of completion of a work package is to have it estimated by your work package manager. He will then tell you that the work package is 78% complete. How does your work package manager determine this figure? He probably estimated it subjectively. Such subjective estimates contain a large degree of uncertainty, especially for longer-lasting work packages.

Discrete Effort or Measurable Effort

Discrete Effort is work toward a specific final product or result. It is the preferred classification of work, as it can be assessed objectively. An example of this work category is an engineering work package, which has a construction drawing as a single and specifically measurable product.

Apportioned Effort

Apportioned Effort is work that is not directly definable or measurable; rather it depends on the performance and progress of another specific activity. Apportioned effort is measured as a factor, e.g., 10% of another specific activity, and it always refers to “Discrete Effort” or “Measurable Effort.”

An example for apportioned work can be the function of quality assurance, which inspects a statistical number of produced products.

Level of Effort (LOE)

Level of Effort (LOE) is the third and least-desired Earned Value Work Classification. LOE is not directly related to a specific product; rather it is only measured over a defined period of time. LOE does not measure performance!

This work classification is reserved for “service tasks,” which do not flow directly into a final product. For example, part of the project manager’s work is often classified as Level of Effort, since, in most cases no specific work packages are directly linked to the project manager’s performance.

Read in the Book Earned Value Management – Fast Start Guide more about work classification and project planning in Earned Value Management.

Here you can find more about Earned Value methods to evaluate work performance.

Find More Details About How to Calculate the Earned Value in This Book