Part 72: To-Complete Performance Index (TCPI)

Part 72: To-Complete Performance Index (TCPI)
(Project Cost Management: Control Costs)

• While executing the project, we may be overbudget and/or behind schedule
• We want to complete our project within a specific goal (on budget and on time, or close to that)
• TCPI tells us how our project should perform in order to meet that goal
• TCPI = (BAC – EV) / (BAC – AC)
• The top part of the equation (BAC – EV) tells us how much work is left (in dollar value)
• The bottom part of the equation (BAC – AC) tells us how much budget is left
• If we are over budget, then we have more work left than money, and our TCPI will be less than one
• If we are under budget, then we have more money than work, and our TCPI will be more than one
• If our budget is no longer realistic, we can accept our new budget, the Estimate at Completion
• We get our new budget, the Estimate at Completion
• The equation changes to TCPI = (BAC – EV) / (EAC – AC)
• We need to complete our work within the TCPI or the project will fail not be completed on budget
• If our TCPI is close to one (0.9 to 1.0), we might try to finish the project within our budget
• If our TCPI is less than 0.9, we might decide that we can’t finish our project within the budget