A project team is working on a 6-month software project with a budget of US$150,000. After 3 months, the team assesses the project's progress. At this point, the team determines that US$70,000 worth of work has been completed, but the planned value for this stage was US$75,000.
To calculate the schedule variance (SV), we use the formula:
SV = EV – PV
Where:
EV (Earned Value) is the value of the work completed.
PV (Planned Value) is the value of the work that was planned to be completed.
EV is given as US$70,000. This represents the value of the work completed after 3 months.
PV represents the value of the work that was planned to be completed at this point, which is US$75,000 according to the project plan.
Now, calculate the SV:
SV = EV - PV
SV = US$70,000 - US$75,000
SV = -US$5,000
Consequently, the SV for this project is -US$5,000.
A positive SV indicates your project is ahead of schedule.
A negative SV indicates your project is behind schedule.
An SV equal to 0 indicates your project is on schedule.
The answer indicates that the project is behind schedule by US$5,000.