Study On How To Control Project Cost Based On EV Methodology

In recent years, the profit of consumer electronics industry has been becoming lower andlower under the more competitive environment of the rapid development and the fluctuantmarket. As OEM manufacturer, we would not only focusing on the market but also theinternal operation management to reduce costs, maintain profits, in order to improve marketcompetitiveness. The execution is a short life cycle with strong variability for the programs inconsumer electronics industry. There is more relevant between program P&L and cost controlmanagement. So, do a good job of cost control is the top priority of project management andits relationship to the level of corporate profitability and even survival. To better accomplishthe goal of the project execution, project managers need to adopt management models andmethods which adapts to achieve. For program manager, the core management activities arecentered around cost management launched, which requires project managers to implementstrict scientific method in accordance with the project budget, early discovery bias, analyzeproblems, real-time correction, so that the cost of the project in the effective control Underconducted to ensure that the project is expected to be realized profit.In this paper, the research and application of the actual project cost management as the goal,after analyzing the difference between history and current status of project management aswell as project management and project management of foreign studies, project costmanagement refers to the basic concepts of earned value principles of earned value method tostudy and optimize its theoretical and applied project cost control process, in order to improvethe efficiency of the project cost control. The author’s perspective of the project manager tothe actual data and operation of the project in P company, describes the process of preparingthe project breakdown structure, schedule and establish a budget, a detailed description ofhow to use earned value theory, especially in quality control portion of the earned valuesystem and compared with the traditional method of cost control, earned value methodhighlights the advantages in terms of cost management. The paper also pointed out that thetraditional earned value some of the pitfalls, and by introducing secondary earned value, buildcost-schedule-quality at the core of earned value system, the earned value theory optimized.After research results and methods used in the project cost control, earned value through staticand dynamic analysis methods to analyze earned value cost of the project, the project earnedvalue method using strict cost control process design, each milestone as a baseline monitoring,so that real-time monitoring and timely correction, the ideal final results of the projectcompleted. Results of the study show that the results established by empirical analysis system earnedvalue cost control system, and to strengthen the implementation of the principle of applicationof earned value the progress of the project, cost and quality control should pay attention totwo issues:(1) that earned value method Calculating the value of earned value accuracy,analysis forecasting capability (2) the cost is relatively weak.In this study, earned value theory in practical projects to improve the project costmanagement and orderly, controllability, scientific and practical. Large amounts of datashowed that the principle of earned value management is a suitable tool for project costcontrol, the study also pointed out the imperfections and the personal recommendation of theexisting earned value project management, to promote and enrich the project cost controltheory has some significance of domestic consumer electronics products quickly (such asmobile phones, etc.) manufacturing companies to promote the use of earned value project costmanagement also has some reference and inspiration. In this study, earned value theory inactual projects, low-margin businesses operating in the state of implementation of demandbased on earned value project cost control is the choice of history, but also realistic in practice,constantly exploring, constantly exploring summary, choose their own enterprise project costcontrol management, improve earned value management system to optimize the allocation ofresources, enhance the value of creativity and competitiveness, so as to promote healthydevelopment of enterprises, stronger and better.