Research On Project Cost Control Of M Company Based On Earned Value Method

Since the reform and opening up,China’s rapid economic development,urbanization progress accelerated,As a pillar industry of national economy,construction industry is an important part of national economy is also developing rapidly.The number of construction enterprises has increased year by year in recent years,but the profitability of the construction industry output value has continued to decline.With the "Opinions on Promoting the Sustainable and Healthy Development of the Construction Industry","Specifications for the Management of General Contracting of Construction Projects" and a series of other policies at various levels concerning the construction industry and general contracting of projects,the construction industry is becoming more and more standardized,and the management level of construction enterprises is becoming more and more demanding,and the competition among enterprises will become more and more intense.This paper firstly starts from the background of the current situation of cost control in the construction industry,and proposes the theory of project cost control and the principle of the earned value method as the theoretical basis of this paper by summarizing and analyzing the domestic and foreign literature studies;secondly,it analyzes the current situation of the project cost control work of Company M through field research,points out the problems in its project cost control work,and analyzes the causes of the problems;then,taking Company M’s project cost control as an example,it points out the necessity and feasibility of introducing the earned value method to its project cost control work.Then,taking the project cost control of Company M as an example,we pointed out the necessity and feasibility of introducing the earned value method to its project cost control work,and proposed the principles of project cost control based on the earned value method and the general idea of implementing the earned value method,through the work structure decomposition diagram,making the project schedule and determining the testing point,preparing the project cost budget table,collecting and calculating the project cost data of the earned value method,and making the analysis of the project cost data of the earned value method.The application of the earned value method has enhanced the cost control awareness of the whole company,the informational process of the company has been promoted,and the project management capability has been improved.The application of the earned value method has led to the enhancement of the cost control awareness of all staff,the promotion of the enterprise’s informational process,and the improvement of the project management capability.Finally,it was concluded that the organization and management work of M Company needed to be improved in the process of applying the earned value method,including optimizing the project cost control organization process,improving the project cost information management system,and establishing and improving the project cost performance assessment system.The study also proposed the basic work that must be done to implement the earned value method,establish a sound cost control system,build a dynamic monitoring mechanism for the whole process of project cost control,and establish a cost assessment mechanism that combines responsibility and rights.As well as the four necessary safeguards for the implementation of the earned value method,including the safeguards in four aspects,such as organizational structure,cost system,information technology and financial arrangement.These countermeasures and suggestions can ensure that the earned value method can achieve better results in project cost control,improve project profits and enhance the overall efficiency of the enterprise.The study shows that in the project cost control work of M company,the earned value method can realize the synchronous control of project schedule and cost target,which is a scientific,feasible and effective method of project cost control,and the conclusion of the study can be used by the counterparts in the construction industry.