Earned Value for the PMP Exam
The math required for the Project Management Professional (PMP)® exam has long worried candidates. People studying for this PMI certification seem to be concerned about what calculations they might be expected to do as part of the test.
However, the exam was updated in 2021 and that, combined with the release of the seventh edition of A Guide to the Project Management Body of Knowledge (PMBOK® Guide) has actually reduced the amount of earned value PMP questions you are likely to see. At least, that’s our unofficial view. We don’t have any insider knowledge, but what we are seeing and hearing from the project management community is that you shouldn’t be worried if math is not your strong point.
Let’s look at what topics you should be familiar with and the common calculations you should understand prior to taking your PMP exam. In general, it would be helpful to be comfortable with the following terms and earned value management formulas:
- Schedule variance
- Cost variance
- Planned value
- Schedule performance index (SPI)
- Cost performance index (CPI)
- Budget at completion (BAC)
- Estimate at completion (EAC)
It would also be helpful to learn a little about the full earned value management system so you can visualize how each component fits together. For example, understand what makes up the project budget and how it is allocated, find out how project schedule data is constructed and how that links with the project plan.
Concentrate on the ‘why’
If you are studying earned value for the PMP exam, then focus on the ‘why’. Make sure you understand the terms and what they mean, and how they can be used in practice. You are far more likely to get a scenario-based question that asks you to interpret data than you are to see a question that asks you to do the math yourself.
As a result, spend more time on familiarizing yourself with what good looks like on a project. If you know how much actual work has been carried out and what was planned, can you use earned value metrics to guide what corrective action (if any) is required?
Work through a lot of sample questions and spot the themes – of course, none of those questions will appear on your real exam paper, but the style of the question will help you feel confident with any required math on the day.
Answering earned value PMP questions
You may get earned value PMP questions on your test, but as we’ve seen, these are more likely to be scenario-based. That means you’ll be given a short ‘story’ or description of project performance. You might get a few details about the cost baseline or schedule baseline, the authorized budget or even the names of the people in the project team. Some of the data might not be relevant for the earned value calculations, but some might help you spot current trends.
Remember that the scenario will represent a given period of time or a single moment in the entire project. Performance data can change from reporting period to reporting period, depending on the actions of the project team, so answer the question as it is stated, not what you think might happen in the future.
Read all the data and the question. You might have to choose the option that is the best course of action for the team to work on. You might have to pick the choice that best represents the next step for the project manager, given the data in the scenario. Take your time and make sure you understand what is being asked before selecting a response (or several, depending on what the question is asking for).
Skipping the math
From what we know, there aren’t loads of pure math questions on the test. The range of earned value PMP questions, or other math-related questions, might surprise you – in a good way! However, if you really do struggle interpreting the question, or you can’t make sense of the answer, then don’t get hung up on it. Mark the question for review and skip it for now. Keep going with the test and if you have time left over at the end, come back and have another go.
Remember that there is no negative marking in the PMP exam, so if you really don’t know what answer choice is best, just pick one. It’s often possible to eliminate the answers you know to be wrong. You might get lucky and pick up an extra mark! You would certainly miss out on a mark if you left the question blank.
In the past, the calculation and formula-based questions were an easy way to pick up marks. If you knew the formulas, it was simple to work out the answers and choose the best response. However, the current iteration of the PMP exam relies more on your ability to make the right management choice from the project performance data provided. That’s a far more realistic representation of what your working day as a professional project manager is like.
In real life, you don’t have to know how to do those calculations. We don’t see project managers on construction sites whipping out their calculators to manually work out the SPI or to add up the actual cost of work performed. Instead, modern software like Primavera P6 combined with a range of specialist tools produce project performance reports for each time period that compares current progress to the performance measurement baseline.
If the calculations for earned value were worrying you, don’t let them. Focus your study efforts on making sure you understand the terminology and what it represents, and then move into learning the other knowledge areas and performance domains. And good luck on the test!
PMI, PMP and PMBOK Guide are registered marks of Project Management Institute, Inc.