To-Complete Performance Index (TCPI)
The To-Complete Performance Index (TCPI) is a measure of the cost performance that must be achieved on remaining work to meet a specified management goal, either the BAC or EAC.
Explanation
TCPI calculates the required efficiency for the remaining work to achieve a cost target. There are two versions of the formula depending on the target.
To finish within the original budget: TCPI = (BAC - EV) / (BAC - AC). To finish within the revised estimate: TCPI = (BAC - EV) / (EAC - AC). The numerator in both formulas is the same: the remaining work expressed in budgeted terms (BAC - EV). The denominator represents the remaining funds available.
A TCPI greater than 1.0 means the team must perform more efficiently than planned to meet the target. A TCPI of exactly 1.0 means current efficiency is sufficient. A TCPI less than 1.0 means the team can afford to be less efficient and still meet the target. The higher the TCPI, the harder it becomes to achieve the goal, particularly values above 1.1 to 1.2, which are generally considered unrealistic to sustain.
Key Points
- •Based on BAC: TCPI = (BAC - EV) / (BAC - AC)
- •Based on EAC: TCPI = (BAC - EV) / (EAC - AC)
- •TCPI > 1.0 = must improve efficiency; TCPI < 1.0 = can relax efficiency
- •Values above 1.1-1.2 are generally considered very difficult to achieve
Exam Tip
Know both TCPI formulas. The BAC-based version asks: Can we still meet the original budget? The EAC-based version asks: Can we meet the revised forecast? TCPI > 1.0 means harder work ahead.
Frequently Asked Questions
Related Topics
Estimate at Completion (EAC)
Estimate at Completion (EAC) is the expected total cost of completing all work, calculated by projecting current performance into the future.
Estimate to Complete (ETC)
Estimate to Complete (ETC) is the expected cost needed to finish all remaining project work from the current point in time.
Cost Performance Index (CPI)
Cost Performance Index (CPI) is an EVM efficiency metric that measures cost performance as the ratio of earned value to actual cost: CPI = EV / AC.
Test your knowledge
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