The application of earned value management to manage project costs within the South African municipal infrastructure sector

Abstract

If not managed properly, the cost of South African municipal infrastructure projects could represent a major financial burden on the country’s fiscus. Cost management on these projects is, therefore, a significant parameter that needs to be managed appropriately. Earned Value Management (EVM) is a control tool that integrates a project budget and schedule in a single monitoring and control mechanism that has the potential to improve overall project performance in this sector. However, it is necessary to first investigate factors that would lead to increased acceptance of EVM within the sector. To solicit the perceptions regarding project cost management within the sector, a survey questionnaire was developed and distributed to project managers working in the municipal infrastructure sector in South Africa. Descriptive and inferential statistics were used to analyse the data received. Indications are that project managers working in the municipal infrastructure sector recognise the importance of managing project costs. However, attention should be paid to a formal cost control system that interfaces with the current reporting practices; is integrated into and accepted by the whole project team; and is supported by national norms and sector (e.g. water or energy) norms.