Schedule Performance Index (SPI) Explained with Examples

In project management, SPI is used to measure the efficiency of the project schedule. The other metric known as the cost performance index (CPI), on the other ... Skiptocontent Oneofthemostcrucialtoolswhenconductingaprojectistheprojectschedule.Thistoolconveysawiderangeofdetails,includingthedeadlines,thetasksthatneedtobecompleted,theresourcesallocatedtocompletetasks,duedates,themilestonesthatareexpectedtobeaccomplished,andmanymore.Failureinkeepingupwiththeschedulemayleadtovariousnegativeimpactssuchasexceedingthebudgetaimedfortheproject,failureinqualitychecksforthedeliverables,disappointmentamongstakeholders,andlastlyitwoulddisrupttheperformanceofthestaffandstressingthemout.Infact,nobodywouldbehappyiftheprojectfallsbehindthescheduleregardlessofwhichpositiontheyarein.Hence,inordertokeepthescheduleontrack,projectmanagerswouldemployanumberofstrategiessuchasPERTcharts,Ganttmaps,prioritisationmatrix,andmanymore. Anothermeasurementthatcouldbeusedtocalculatehowwellaprojectisdoinginrelationtotheinitialscheduleisknownasthescheduleperformanceindex(SPI). WhatisSchedulePerformanceIndex Scheduleperformanceindex(SPI)isoneoftheoutputsundertheearnedvaluemanagement(EVM).EVMisoneofthewidelyknowntechniquesusedtoevaluatetheperformanceofaprojectbydemonstratinghowthecompletedprogresscorrespondstothebenchmarksetduringtheplanningstageoftheproject.Insimplerwords,SPIcouldbedefinedasthescheduleperformanceanalysisofaproject. OneoftheothercalculationsthatareoftenrelatedtoSPIistheschedulevariance(SV).Schedulevarianceaimstocalculatehowmuchtheactualworkdivergesfromtheexpectedschedule.Thescheduleperformanceindex,ontheotherhand,measurestheratiooftheworkprogresswiththeschedule.Regardless,bothcalculationsareusedtoassesseithertheprojectisahead,on,orbehindtheestablishedschedule. SchedulePerformanceIndexinProjectManagement Itshouldbenotedthatthescheduleperformanceindexhasitsowndisadvantages.Thereareseveraltipstobenotedwheneveryouintendtousethescheduleperformanceindexforyourproject.Firstly,SPIdoesnotprovidethedifferencesforcriticalornon-criticaltasks.Somenon-criticaltasksthatareprogressingaheadofschedulemayobstructthecriticaltasksthatarebehindtheschedule.Hence,itiscrucialtobeabletodistinguishandprioritizethetasksaccordingtothelevelofcriticalnessandcomplexity. x ToviewthisvideopleaseenableJavaScript,andconsiderupgradingtoa webbrowserthat supportsHTML5video WhyShouldWeHireYou?5BestAnswers TheotherthingtoconsideristheaccuracyofthedatafortheSPI.InordertoachieveareliableandaccurateSPI,thedataandreportsfortheprocessmustbeaccuratetoo.IftheSPIdoesnotprovideaprecisevalue,itmaydisplayinaccuracyfortheinformationoftheproject’spacewhichmaypressuretheworkersorworse,delaythecompletionoftheproject.Thelastthingtobearinmindisthatinordertoachieveamoreaccurateoutlineoftheproject’sperformance,itisrecommendedtoapplyotherprojectmanagementtechniqueswiththeSPIvalues,notrelyingsolelyonSPI. HowtoCalculateSchedulePerformanceIndex Theformulaofscheduleperformanceindexis: SchedulePerformanceIndex(SPI)=EarnedValue(EV)/PlannedValue(PV) SPI=EV/PV Afurtherclarificationoftheformulawillbeelaboratedinthelatterpartofthisarticle. ClickHeretodownload3000+ProjectManagementDocuments:CompleteLibraryofProjectManagementTemplates,Processes,Plans,Checklists,Forms,Tools,PresentationSlidesandInfographics.SuitableForAllIndustries. Thereareseveralstepsthatoughttobefollowedinorderwhendevelopingscheduleperformanceindex(SPI)whichare: Step1:Calculatingthepercentageofcompletionfortheprojecttasks. Step2:DeterminingthePlannedValue(PV). Step3:DeterminingtheEarnedValue(EV). Step4:DeterminingtheSchedulePerformanceIndex(SPI). PlannedValue(PV) PlannedValue(PV),oritsothernameBudgetedCostofWorkScheduled(BCWS)referstothenumberoftasksexpectedtobecompletedinaccordancewiththetasksbudget.Itsmainemphasisisontheproject’sbudget. Forexample,ifataskisscheduledtobecompletedinamonthandthebudgetexpectedis$10,000,byhalfofthemonth,theamountofbudgetusedisapproximately$5,000,whichisalsohalfofthetotaltaskbudget.BelowistheformulaincalculatingPlannedValue: PV=PercentComplete(planned)xTaskBudget EarnedValue(EV) Ontheotherhand,EarnedValuereferstotheamountoftasksthataretotallycompleted.ItisalsoknownastheBudgetedCostofWorkPerformed(BCWP).Thisvalueisalsodeterminedfromthebudgetoftheproject.TheformulaforEarnedValueisasfollow: EV=PercentageofCompletedWorkxBudgetatCompletion(BAC) Thecompletedworkcomprisesallthecostsfortheworkincludingthetransport,labour,equipment,licenses,andmanymore.Thebudgetatcompletionisthetotalbudgetfortheproject. Forexample,ifthepercentageofcompletionforaprojectis50%andthebudgetis$5,000,theearnedvalueis$2,500. ThecorrespondingPlannedValue(PV)andtheEarnedValue(EV)mustbedeterminedindividuallyforeachtaskinordertomeasuretheoverallSPIoftheproject.Eachprojectshouldfirstlybesegregatedintomorespecifictasksandareassignedwiththestartandfinishdates,andthebudgetforthetask.Thisinformationwouldbethebaselineintrackingtheanalysisofthescheduleperformance. SchedulePerformanceIndexFormula Theformulatocalculatethescheduleperformanceindexofaprojectisasfollows: SchedulePerformanceIndex(SPI)=EarnedValue(EV)/PlannedValue(PV) SPI=EV/PV Fromthecalculation,thesearetheexplanationiftheSPIdisplaysthefollowingvalues.IftheSPIislargerthan1,theprojectisaheadoftheschedule.Ifthecalculatedvalueissmallerthan1,itindicatesthattheprojectisbehindtheschedule.Finally,iftheSPIequalsto1,thatmeanstheprojectisonschedule. Belowistheindicatorforthevaluecalculated: SPIValueIndication0Theprojecthasnotyetstarted0.5Halfoftheprogressexpectedachieved1.0Theprojectisonschedule2.0Theprogressistwiceasmuchastheexpectedschedule Foraneasyexample,let’ssayyourprojectistargetedtofinishin4weeks,anditiscurrentlyinthesecondweek.Theprogressofyourprojectshould,byright,achievecompletionof50%. SchedulePerformanceIndexExamples Let’strytodoanSPIcalculation. EXAMPLE1 ProjectAisexpectedtobecompletedin3monthsandthebudgetallocationis$15,000.Itisalreadyinthemidofthesecondmonthand50%oftheprojecthasbeencompleted,signifyingthattheprojectisonschedule. EarnedValue: EV=PercentageofCompletedWorkxBudgetatCompletion(BAC) EV=50%x$15,000 EV=$7,500 PlannedValue: PV=PercentComplete(planned)xTaskBudget PV=50%x$15,000 PV=$7,500 SchedulePerformanceIndex: SPI=EV/PV SPI=$7,500/$7500 SPI=1.00 ThevaluecalculatedforSPIis1.0,indicatingthattheprojectisonschedule.Eachhourofworkspentforthejobiswortheveryhourworthofwork. EXAMPLE2 ProjectBisexpectedtobecompletedin10daysandthebudgetallocationis$5,000.6dayshavepassedandthepercentageofworkdoneis75%.  Itisalreadyinthemidofthesecondmonthand50%oftheprojecthasbeencompleted,signifyingthattheprojectisonschedule. EarnedValue: EV=PercentageofCompletedWorkxBudgetatCompletion(BAC) EV=75%x$5,000 EV=$3,750 PlannedValue: PV=PercentComplete(planned)xTaskBudget PV=60%x$5,000 PV=$3,000 SchedulePerformanceIndex: SPI=EV/PV SPI=$3,750/$3,000 SPI=1.25 ThevaluecalculatedforSPIis1.25indicatingthattheprojectisaheadoftheschedule. SchedulePerformanceIndexCalculator Althoughtheformulasarepresentedabove,thereareseveralonlinewebsiteswhichfeatureSPIcalculatortoeaseyourtasksincalculating.OneofthewebsitesareAJDesigner.com(https://www.ajdesigner.com/phpearnedvalue/schedule_performance_index.php)andProject-Management.info(https://project-management.info/calculator-cost-schedule-performance-index-cpi-spi-variances/). YoumayconsiderusingthecalculatortopracticeoncalculatingSPIinpreparingforthePMPexam.BeingcertifiedwiththisProjectManagementProfessional(PMP)mayboostyourcareerhenceitishopedthatyoucouldeasilyacethequestionsonSPItoincreasethechancesofpassingtheexamwithflyingcolours. SchedulePerformanceIndex(SPI)andCostPerformanceIndex(CPI) Inprojectmanagement,SPIisusedtomeasuretheefficiencyoftheprojectschedule.Theothermetricknownasthecostperformanceindex(CPI),ontheotherhand,isusedtomeasuretheefficiencyoftheproject’scost.Itcalculatestheratioofcostspenttotheamountofworkcompleted. TheformulatocalculateCPIisasfollow: CostPerformanceIndex(CPI)=EarnedValue(EV)/ActualCost(AC) CPI=EV/AC ThevaluecalculatedforCPIprovidesindicatorsthataresimilartoSPIwhereCPI= 1indicatesthattheprojectisonbudget.CPIvalueofmorethan1impliesthattheamountoftaskscompletedexceedsthetotalamountofcost.Lastly,CPIlowerthan1indicatesthattheprojectisoverbudget. Toconclude,SPIisoneofthecommonlyusedtechniquestoensurethattheprojectprogressesasexpectedfromthescheduleestablished.Althoughthistechniqueissometimesquestionedduetoitsflaws,itcouldprovidearoughideaoftheperformanceofyourprojectasexpectedfromthescheduling.Inordertofullyutilizethistechnique,youmaywanttolookintoanyprojectmanagementsoftwareortoolsthatareequippedwiththefeaturesrelatingtoSPI. 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