VIEWPOINT FEATURE |
Should the rail industry be looking beyond earned value management? Donna Butchart, MD of PrĹ?ject EU Ltd, looks at efficiency in financial management
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ith the number of UK rail passenger journeys suffering from the largest fall since the early 1990s the industry is facing some severe challenges. The result is the more acute need to accurately measure major and infrastructure projects for companies. There has been a rising adoption of Earned Value Management by finance teams to track and monitor major project status. The benefit of earned value over more traditional finance measures is that it helps a business manage the complexity of monitoring the right metrics to measure project success when reporting on project progress. Those project control teams managing rail infrastructure projects expect software that uses sets of metrics relating to cost, timings, quality and progress. However, the number of bridges built, the length of track installed or the procurement of new fleet does not adequately reflect the real project status, which means that organisations have a lack of true transparency on progress. The value of Earned Value The rail industry, including Network Rail, recognise Earned Value Management as a valuable tool for reporting on project progress. There is a growing realisation though that even this trusted methodology provides challenges for those teams who are having to manage large portfolios of complex projects. The reliance on costings to reflect progress is difficult, particularly if there are budget over-runs, unexpected costs or unforeseen circumstances, such as the Covid-19 lockdown. Similarly using completion milestones for timings and schedules without quantifiable deliverables can make it difficult to effectively track progress. Relying solely on earned value management though as the progress metric for major rail infrastructure projects can
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