Earned Value Management System (EVMS) is a project management methodology that integrates scope, schedule, and cost data to measure project performance objectively. Governed by the EIA-748 industry standard, EVMS is required under DFARS 234.201 for DoD contracts exceeding $20 million and is referenced in many large civilian agency contracts as well.
EVMS produces three core data streams: Planned Value (the budgeted cost of work scheduled), Earned Value (the budgeted cost of work performed), and Actual Cost (the real cost of work performed). From these streams, performance indices are calculated — Cost Performance Index (CPI) and Schedule Performance Index (SPI) — which provide objective signals of whether a program is on track, behind schedule, or over budget. Variance analyses explain the root causes of deviation and inform corrective action.
Contractors bidding on EVMS-required contracts must demonstrate either a compliant or a certified EVMS during proposal evaluation. Certification is granted by the Defense Contract Management Agency (DCMA) and requires significant investment in process, tooling, and trained personnel. For smaller contractors, EVMS-required contracts often necessitate a teaming arrangement with a partner who holds DCMA certification, since standing up a compliant system from scratch can take 12-24 months.