Schedule Performance Index for PMP(r), Professionals

Ever wonder how PMP(r), professionals are so accurate in assessing projects? Project managers carefully evaluate each aspect of these projects to identify potential flaws, as projects can sometimes deviate from their baseline over the course of their life.
This entire process requires the use of various project management tools. That is why PMP(r), professionals have a variety of techniques and tools to obtain this certificate.
Schedule Performance Index, or SPI, is one such tool of the Earned Value Management process. Project managers can use SPI to determine the current position, shifts, as well as the progress made since baseline. We will explain how SPI works and why project managers should learn it.
Picture by Bich Tran, Pexels
What is Schedule Performance Indexing?
Earned Value Management is based on the Schedule Performance Index, or SPI. You may now be curious about the meaning of Earned Valu Management. EVM is a project management technique that predicts likely risks and measures the project’s performance.
This method considers the cost, schedule, scope, and costs of the project. It then integrates them to determine any necessary alterations.
SPI is basically a project performance metric. It evaluates project deviations from their baseline and how far it is from the schedule. It runs the actual project through the system to provide us with the comparison to its original planned progress.
It is a ratio between Earned and Planned Valu, so it gets interpreted according to the integer it produces.
As a project manager, it is important to be able to make accurate guesses and eliminate risks. You can make an informed decision by using Schedule Performance Indexing.
It gives project managers a view of the project’s compliance to the plan. The interpreted SPI values show the project’s time efficiency so that project managers can alter the process.
Fundamental Terms for Schedule Performance Indexing
Before you start the calculations, it is important to familiarize yourself with the key terms used in Schedule Performance Indexing. Some terms are used to calculate SPI, while others are used to determine Earned Valu Management.
Planned Value
The Planned value, one of the first elements in EVM, can be described as the amount you originally planned to do by a given point in your schedule. Because it serves as a baseline, the project manager calculates PV prior to project execution.
The total PV is also known by Budget at Completion (BAC).
The formula for PV:
Planned value or PV = (Percentage completed work) * (Budget At Completion or or BAC).
For example:
40% of the work you are assigned is completed within 6 months of the start of the schedule. The project budget is $100,000
So PV = 40% of the BAC
40% off $100,000
= $40,000
Earned Value
Earned value is the actual work done in a given time. Earned value is vital for any project, even if it is terminated or suspended temporarily. It will show you the complete work to date.
This ensures that you get work that is worth the money you have spent. It is also known as Budgeted Cost Of Work Performed (BCWP).
If you are not familiar with the concepts, it is easy to get confused between Earned and Planned value. You should be aware that Planned value is the amount of work that you expect to complete in a given time frame, but Earned value is the work you actually do.
The formula for EV
Earned Value, or EV, is the percentage of work completed * (Budget At Completion or or BAC).
Schedule Variance
Schedule Variance and Schedule Performance Indexing look very similar. SV measures how much you have gained in the project timeline relative to the initial schedule. The calculations are however different.
SV is a comparison