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CPI Below One

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I'm not a project manager, but I know a few things about project management. My PM just sent me a "technical" report about the financial health of the project, and he concluded that CPI is above one. What does it mean? Is it a good thing or a bad thing?
asked 9 years ago by anonymous edited 9 years ago by MaplePM

2 Answers

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A CPI below one is bad news, it means that the project is over-budget. A CPI that is exactly one means that the project is on budget, and a CPI above one is great news, the project is costing less than planned (well, sometimes it's not that great for the project manager, because then his estimates will be cut for the next project, especially if the project is finished under-budget).
answered 9 years ago by MaplePM (46,940 points)
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CPI - Cost performance Index is a measure for the cost efficiency for the work completed.

                                               CPI=EV/AC.

If it is less than 1 then the it is cost overrun for the work completed & if it is more than 1 then it is cost underrun for the work completed.
answered 9 years ago by aal (470 points)

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