THE EFFECTIVENESS OF THE EARNED VALUE MANAGEMENT METHOD IN RISK-ORIENTED MANAGEMENT OF FIXED-PRICE BUSINESS PROJECTS
Abstract
The aim of this study is to practically demonstrate the effectiveness of integrating the Earned Value Management (EVM) method into risk-oriented management of fixed-price projects. For many years, scientists, business communities, and managers have been working to improve the efficiency of project implementation. Research shows that modern projects have a significantly higher success rate compared to decades ago. However, the percentage of problematic or failed projects still constitutes the majority. The effective application of management methods in projects helps managers improve project success rates. As a result of this study, an analysis of statistical data for various project management approaches, particularly fixed-price projects, was conducted. The paper clarifies the characteristics of the Earned Value Management (EVM) method and its effectiveness in risk-oriented management of business projects. Given the relevance of the issue of failures in large-scale project implementation, modern reports (KPMG, PMI) are used to analyze the application of EVM as a tool for forecasting costs, time, and deviations from the plan. The article discusses the positive impact of EVM integration into business projects for risk identification and performance control. A practical example of an IT project with EVM implementation is presented, where key performance indicators (CPI, SPI) are analyzed, and scenarios of possible deviations and risks are considered. The relevance of the topic is driven by important factors such as the large number of fixed-price projects across various business sectors, the increased level of risk when working with fixed-price projects, and the availability of accurate data for cost and schedule control. The article has practical value and is relevant not only for project managers but also for business owners, business analysts, team leads, and other managers who will have access to real-time quantitative indicators. The EVM method is an effective tool for risk management in fixed-price projects and facilitates proactive decision-making based on quantitative indicators.
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