History of EVM

The genesis of EVM was in industrial manufacturing at the turn of the 20th century, but the idea took root in the United States Department of Defense in the 1960s. The original concept was called PERT/COST, but it was considered overly-burdensome (not very adaptable) by contractors who were mandated to use it, and many variations of it began to proliferate among various procurement programs.

In 1967, the DoD established a criteria-based approach, using a set of 35 criterion, called the Cost/Schedule Control Systems Criteria (C/SCSC). In 1970s and early 1980s, a subculture of C/SCSC analysis grew, but the technique was often ignored or even actively resisted by project managers in both government and industry. C/SCSC was often considered a financial control tool that could be delegated to analytical specialists.

In the late 1980s and early 1990s, EVM emerged as a project management methodology to be understood and used by managers and executives, not just EVM specialists. In 1989, EVM leadership was elevated to the Undersecretary of Defense for Acquisition, thus making EVM an essential element of program management and procurement.

In 1991, Secretary of Defense Dick Cheney cancelled the Navy A-12 Avenger II Program due to performance problems detected by EVM. This demonstrated conclusively that EVM mattered to secretary-level leadership. In the 1990s, many U.S. Government regulations were eliminated or streamlined. However, EVM not only survived the acquisition reform movement, but became strongly associated with the acquisition reform movement itself. Most notably, from 1995 to 1998, ownership of EVM criteria (reduced to 32) were transferred to industry by adoption of ANSI EIA 748-A standard[5].

EVM was not limited to the DoD for long. It was quickly adopted by the National Aeronautics and Space Administration, United States Department of Energy and other technology-related agencies. Many industrialized nations also began to utilize EVM in their own procurement programs. The construction industry was an early commercial adopter of EVM. Closer integration of EVM with project management profession accelerated in the 1990s.

The primary professional association for EVM, called the Performance Management Association merged with the Project Management Institute (PMI) in 1999 to become PMI’s first college, the College of Performance Management. An overview of EVM was included in first PMBOK Guide® First Edition in 1987 and expanded in subsequent editions. Efforts to simplify and generalize EVM gained momentum in the early 2000s.

The United States Office of Management and Budget began to mandate the use of EVM across all government agencies, and for the first time, for certain internally-managed projects (not just for contractors). EVM also received greater attention by publicly-traded companies in response to the Sarbanes-Oxley Act of 2002.