PMI-SP Exam - Topic 3 Question 40 Discussion

According to the question, you are required to calculate the schedule performance

index (SPI) of the project. Schedule performance index

(SPI) is the measure of schedule efficiency on a project. It is used in trend analysis to predict future

performance. SPI is the ratio of earned

value to planned value. The SPI is calculated based on the following formula:

SPI = Earned Value (EV) / Planned Value (PV)

If the SPI value is greater than 1, it indicates better than expected performance, whereas if the value

is less than 1, it shows poor

performance. The SPI value of 1 indicates that the project is right on target. Here, SPI is calculated as

follows:

SPI = EV / PV

= 425/400

= 1.0625

As the SPI (1.0625) is greater than 1, it shows that the schedule performance is better than

expected.

What is BCWP (or EV)?

Budgeted cost of work performed (BCWP) or Earned Value (EV) is the value of completed work. It is

the budgeted amount

for the work actually completed on the schedule activity during a given time period.

What is BCWS (or PV)?

Budgeted Cost of Work Scheduled (BCWS) or Planned Value (PV) is the authorized budget assigned

to the scheduled work

to be accomplished for a schedule activity or Work Breakdown Structure (WBS) component.

What is ACWP (or AC)?

Actual cost of work performed (ACWP) or Actual Cost (AC) is the total costs actually incurred and

recorded in accomplishing

work performed during a given time period for a schedule activity. It is the cost of the work to date,

including direct and

indirect costs. AC is money that has actually been expended to date.