A program has a BAC of $1,750,000 and is expected to last two years. The program is currently at the third milestone which represents 35 percent of the program work. As it happens, this program has already spent $620,000 of the budget. Management is concerned that the program may also be slipping on schedule because the program should be forty percent complete by this time. Based on this information which type of performing is present in this scenario?
The program's schedule performance index (SPI) can be calculated using the formula SPI = EV / PV, where EV (earned value) is the value of work actually performed and PV (planned value) is the value of work planned to be performed. Here, EV is 35% of BAC (0.35 * 1,750,000 = 612,500) and PV is 40% of BAC (0.40 * 1,750,000 = 700,000). Hence, SPI = 612,500 / 700,000 = 0.88. A SPI less than 1 indicates schedule slippage. Therefore, the performing issue present in this scenario is related to the schedule, as indicated by the schedule performance index of 0.88.
C is correct answer BAC = 1750000, AC = 620000 EV = 0,35 x 1750000 = 612,5 CPI = EV/AC = 612,5/620000 = 0,98175 PV = 0,4 x BAC = 0,4 x 1750000 = 700 SPI = EV/PV = 612,5/700 = 0,875 =0,88