Schedule Performance Index (SPI): An Introduction

Schedule performance index (SPI) is part of a greater project performance measurement method called earned value management (EVM). The SPI ... SkiptoContent Scheduling ByQuincyYarbrough   |   Jun23,2021 Ifsomeoneaskedhowmuchvalueyougetfromadayofwork,whatwouldyousay?Oddsare,you’dgiveoneofthecustomaryresponses—afairamountofvalue,notmuchvalue,alotofvalue,etc.Unfortunately,theseanswersaren’thelpfulandaren’tvaluabletoprojects. Thescheduleperformanceindexwascreatedtoeliminatetheguessworkandgiveaspecific,quantifiableanswertothequestion,aswellasshowwhereimprovementsneedtobemadeformaximumefficiency. WhatIstheSchedulePerformanceIndex? Scheduleperformanceindex(SPI)ispartofagreaterprojectperformancemeasurementmethodcalledearnedvaluemanagement(EVM).TheSPIitselfisaratioofearnedvaluetoplanned(oractual)value.Dependingontheinteger,SPIreflectsaprojectbeingonschedule,behindscheduleoraheadofschedule. Createschedulesandautomaticallycalculateschedulevariance.TryProjectManagerforfreetoday! Anotherwaytothinkaboutthescheduleperformanceindexishowwemeasurethevalueofworkcompleted.SPIdoesthisbycomparingtheprogressweplannedtomaketotheactualprogressmade.Inotherwords,howaccurateisourprojectschedule?Deviationsfromthisprojectscheduleareindicativeofanumberofthingstobeawareof. SchedulePerformanceIndexKeyTerms Inordertounderstandthescheduleperformanceindexandhowtocalculateitforyourself,youmustbefamiliarwithafewkeyterms.EachoftheseisanimportantpartoftheSPIequation. EarnedValueManagement:EarnedValueManagement(EVM)isatechniqueusedtomeasuretheperformanceofaproject.Calculatingthescheduleperformanceindexispartofthisprocess. PlannedValue:ThePlannedValue(PV)representswhereontheprojectscheduleyouplannedtobe.Anotherwaytothinkofplannedvalueisashowmuchyouhadexpectedtoaccomplishbyacertainpointintime.Thisusuallytakestheformofhoursworked,or,sometimes,unitsproduced. EarnedValue:TheEarnedValue(EV)isthereality;whereonthescheduleaprojectisat.Ideally,thisnumberiscloseto,orthesameas,theplannedvalue,meaningeverythingisonschedule.AnSPIcalculationconfirmsthis. ScheduleVariance:ScheduleVariance(SV)isanothertypeofcalculationintheEVMmethod,andit’simportanttoknowhowitdiffersfromSPI.Schedulevariancemeasureshowmuchaprojectisdivergingfromtheinitialschedule.SPI,ontheotherhand,measurestheratioofhowmuchworkwasdonetohowmuchworkwasplanned(scheduled). CostPerformanceIndex(CPI):Costperformanceindexisoftenconfusedwiththescheduleperformanceindex.Costperformanceindexisthemeasureofthevalueofworkincomparisontocost.Inotherwords,workdividedbycost.Thisisdifferentfromthescheduleperformanceindex,inthatCPImeasurescostefficiencywhileSPImeasurestimeefficiency. Related:FreeProjectScheduleTemplates TheSchedulePerformanceIndexFormulaandHowtoCalculateSPI Tofindthescheduleperformanceindex,youmustfirstfindtheplannedvalueandtheearnedvalue.SPIisthencalculatedbydividingthisearnedvalueintegerbytheplannedvalueinteger.Therefore,thescheduleperformanceindexisaratioofearnedvaluetoplannedvalue.Whenyouknowyourearnedvalueandplannedvalue,calculatingSPIisassimpleasdividingthetwo. TheSPIFormula Scheduleperformanceindex(SPI)=Earnedvalue(EV)/PlannedValue(PV),orSPI=EV/PV SchedulePerformanceIndexExample Forthisexample,theprojectinquestionisscheduledtolast8months.Duringthat8months,200,000unitsofaproductmustbemade.Atthe2monthmark,theprojectmanagersdecidetocalculateSPI. FindEarnedValue First,youmustfindtheearnedvalue(EV).Thisisassimpleasaccountingforthenumberofunitscreatedsofar.Inthisexample,40,000unitshavebeenmadeatthe2-monthmark. EV=40,000 FindPlannedValue Next,youmustfindtheplannedvalue.Assumingyouplannedtocompletethesamenumberofunitseachmonth,thatmeansyouwouldhavetocreate25,000unitspermonth.So,after2months,youshouldhavemade50,000units. PV=50,000 CalculateSPI Onceyouknowtheearnedvalueandplanned,allyouneedtodotofindSPIisdivideEVbyPV.Thisquotientwillbeanumbergreaterthan,lessthanorequaltoone.Inthisexample,thatwilllooklikethis: 40,000(EV)/50,000(PV)=.8 SPI=.8 This.8(80%)indicatesthattheprojectisbehindscheduleandisonlyrunningatalevelof80%efficiency.Thatmeansthereneedstobea20%improvementtogetbackonschedule. WhatDoesYourSPIResultMean? Tounderstandyourresults,youmustknowwhatdifferentSPInumberssymbolize.Forexample,anSPIabove1equatestobeingaheadofschedule,whereasaSPIunder1meansyou’rebehindschedule.And,ifyourSPIisequalto1,yourprojectisexactlyonschedule.Insummary: SPI>1:Projectisaheadofschedule;moreworkhasbeencompletedthanexpected SPI<1:Projectisbehindschedule;lessworkhasbeendonethanplanned SPI=1:Projectisonschedule;earnedvalueandplannedvalueareequal. WhyisSchedulePerformanceIndexImportant? Calculatingscheduleperformanceindexishowweassesstheaccuracyofascheduleandhowonscheduleaprojectisrunning.Dependingonthescheduleperformanceindex,itmaybenecessarytorethinkhowtheschedulebaselinewascreatedormakeotheradjustments.Theseadjustmentsmightincludecreatingmorepaddedschedulesinthefuture,redistributingworkload,expandingteamsandavarietyofotheractions. Scheduleperformanceindexisespeciallyhelpfulforcallingattentiontoissuesbeforetheyworsen.Ifaprojectisfallingbehindschedule,theSPIwillreflectthisandindicatechangesneedtobemade. Anotherwaytothinkaboutscheduleperformanceindexisasameanstoseehowmuchworkisbeingcompletedcomparedtohowfaralongaprojectis.Whenwethinkaboutitfromthisperspective,scheduleperformanceindexisameasureofefficiency. WhenShouldICalculatetheSchedulePerformanceIndex? Ascheduleperformanceindexshouldbecalculatedatregularintervalsthroughoutaproject.Fallingbehindscheduleisoneofthetopcausesofprojectfailure,andcreatinganSPIisasimplewaytobeproactive. Youcandecideontheseintervalsasyou’recreatingyourschedule,astheymaybedifferentdependingonthetypeofprojectandthelengthoftheproject.TheimportantthingisthattheSPIiscalculatedregularly. HowProjectManagerHelpsYouTrackYourSchedule ProjectManagerallowsyoutoseeyourprojectscheduleacrossmultipleviews,dependingonyourpreference.MonitoryourprojectonaGanttchartandatraditionalcalendarviewwithoutjumpingbetweenGoogleCalendarandyourprojectmanagementtool. UsetheonlineGanttcharttosetbaselinestoautomaticallycomparethingslikeplannedvalueandearnedvalue.Nomorestrugglingwithequationsandriskingmistakes.Ourtooldoesallthecalculationsforyou,inrealtime,sothatyou’realwaysviewingthemostcurrentinformation. And,whenyouwanttocheckinonthestatusoftasks,availableresources,projectbudget,overallhealthandmore,usetheprojectdashboardasyourcommandcenterforeverythingyouneedtomakesmartprojectdecisions. ProjectManagerisanaward-winningtoolthathelpsyouscheduleyourprojectandgivesyouthetoolstheyneedtokeepthatscheduleontrack.Sticktoyourscheduleperformanceindexandmakeyournextprojectasuccess.TryProjectManagerforfreetoday! RelatedPosts ProjectSchedulingTips HowtoCreateaProjectManagementSchedule(ExampleIncluded) 6TipsforBetterScheduleManagement ProductionScheduleTemplate DeliverYourProjectsOnTimeandUnderBudget Startplanningyourprojects. Start30-DayFreeTrial RelatedPosts ProjectSchedulingTips HowtoCreateaProjectManagementSchedule(ExampleIncluded) 6TipsforBetterScheduleManagement ProductionScheduleTemplate