Planned Value (PV)
As per the PMBOK Guide, “Planned Value (PV) is the authorised budget assigned to work to be accomplished for an activity or WBS component.”
The project’s total planned value is known as your budget at completion or BAC and is calculated by summing up the PV for each activity, operation, or task, within your project.
Planned value formula
To calculate the planned value, multiply the percentage of completed work (planned) by the project’s budget (BAC).
Planned Value is calculated by multiplying the (planned) work % complete by our projects budget or BAC
PV = (planned) % complete x BAC
Using this example, let’s calculate our planned value.
1. After 1 month
As you can see in the table above, our project is scheduled for four months. So, after one month, we should (should!) have completed 25% of the work.
E.g.
- Project duration: 4 months
- BAC: $40,000
- Elapsed time: 1 month
- (planned) % complete: 25%
PV = % complete (planned) x BAC
PV = 25% x $40,000
PV = $10,000
2. After 2 months
So, based on our four-month schedule, by the second month, we should have completed 50% of the work.
E.g.
- Project duration: 4 months
- BAC: $40,000
- Elapsed time: 2 months
- (planned) % complete: 50%
PV = (planned) % complete x BAC
PV = 50% x $40,000
PV = $20,000
