# How to Calculate Schedule Performance Index with Examples

The schedule performance index (SPI) is a project management metric that measures how well a project is performing against its schedule. It is calculated by dividing the earned value by the planned value (EV / PV). If the result is less than 1.0 indicates that the project is behind schedule, but if it is greater than 1.0 that means it is on schedule.

Schedule Performance Index (SPI) is a key performance indicator that is used to measure the progress of a project. Since it is a ratio of the actual work done to the work that was scheduled to be done, it is a highly valuable metric because it can be used to predict the likelihood of meeting a project’s completion date.

SPI is a measure of how well the project is doing compared to the schedule. SPI can be used to compare individual projects or to benchmark the performance of an entire organization. For example, if an organization has an SPI of 0.8, it means that, on average, its projects are 80% efficient. Consider that it can also be used to compare the performance of different organizations.

## Why is SPI so important?

The SPI can be used to identify potential problems with a project and to take corrective action to get the project back on track. As it provides a clear and concise way to assess the progress of a project., SPI can be used to assess the current status of a project and predict its future performance.

Additionally, SPI can be used to compare the performance of different projects.

## 3 Strategic Advantages of using SPI in project management

In order to effectively manage a project, it is important to have a clear understanding of how well the project is progressing. Overall, these 3 key benefits will directly impact your future projects.

1. Improves the efficiency and effectiveness of project management processes.
2. Assess the health of a project and identify areas where changes need to be made in order to improve project performance right away.
3. Use it to compare the performance of multiple projects by identifying best practices to apply in future projects

## How to calculate the Schedule Performance Index

The project manager can calculate Schedule Performance Index by dividing the Earned Value (EV) by the Planned Value (PV). The earned value must be calculated on a task-by-task basis and added together. The project managers may use this as a benchmark to measure the schedule by referring to the schedule baseline.

### Calculate the Completion Percentage of each task

Each task would of being defined and estimated in the work breakdown structure. Each task should be reviewed to determine the percentage complete and aggregated to determine the amount of work still to do and completed.

### Calculate the Earned Value (EV)

Earned Value refers to the completed work. It is often referred to as the Budgeted Cost of Work Performed (BCWP). It is calculated using the project’s budget.

EV = Actual percentage of completion * Budget at completion (BAC)

### Calculate the Planned Value (PV)

Planned value is the work to be completed in the given time. Per PMBOK, PV is the budgeted cost for the work scheduled to be done.

Planned Value = (Planned % Complete) X (BAC)

### Calculate the Schedule Performance Index (SPI)

SPI formula – the earned value is divided by the planned value to get the value of the schedule performance index. An SPI of 1.0 indicates that the project is on schedule, while an SPI of less than 1.0 indicates that means the project is behind schedule.

## Calculate Schedule Performance Index Example

SPI Example – Imagine this, you are a project manager whose budget is \$40,000 for a new computer program in the Software Development Company you work for. As time goes by,  20% of the work is completed, but it is against your 35% initial plan and you have spent \$25,000 already.

Project Budget = \$40,000

Earned Value (EV) = 20% of \$ 40,000 = \$8000

Planned Value (PV) = 35% of \$ 40,000 = \$14,000

Schedule Performance Index (SPI) = 8000/14000

Therefore, The Schedule Performance Index (SPI) = 0.57

And as 0.57 is less than 1, that means the project is behind schedule.

There are several factors that can affect SPI.

One is the quality of the schedule itself. A well-designed schedule will take into account known risks and potential changes that could affect the schedule.

Another factor is the organization’s ability to execute the schedule. This includes having the right resources in place and being able to work effectively as a team.

#### What Causes SPI To Be Greater Or Less Than One?

There are a few factors that can cause SPI to be greater or less than one.

The first is the distribution of the data. If the data is evenly distributed, SPI will be close to one. However, if the data is skewed, SPI will be further from one.

The second factor is the number of data points. The more data points there are, the closer SPI will be to one.

The last factor is the type of data. Some data types are more likely to have outliers, which can cause SPI to be further from one.

## Schedule Variance

A project’s schedule variance serves as a gauge for whether it is on time or not. It is frequently used in earned value management (EVM) to give project managers an update on the status of the work during the analysis stage.

Due to the fact that it provides project managers with an accurate view of the project’s progress, schedule variance is critical for project management. To keep the project moving forward, project managers must be able to recognize any obstacles as they materialize and take swift action to remove them. It’s crucial to manage stakeholder expectations when there are timetable variances.

Project managers obtain useful information and data to present at stakeholder meetings when they compute schedule variation. These numbers can reassure project stakeholders that everything is going according to plan.

## How often and when should you calculate SPI?

SPI can be used to assess the progress of a project at any given time, but it is most commonly used during the monitoring and control phase of a project.

SPI can be calculated at any point during a project, but it is most useful when calculated on a regular basis, such as once per month. This allows for early detection of schedule problems and allows for corrective action to be taken before the project falls too far behind schedule.

#### Limitations of Schedule Performance Index

While the SPI is a useful metric, it is important to remember that it only tells part of the story.

The SPI does not take into account the quality of the work that has been completed or the actual costs incurred. For this reason, the SPI should be used in conjunction with other measures of project performance.

# CPI vs SPI

Cost performance index (CPI) and schedule performance index (SPI) are two measures that are often used in project management. They are both used to assess the performance of a project and to compare it to the baseline.

They are both used to assess the performance of a project and to compare it to the baseline.

CPI and SPI are both important measures to consider when assessing the performance of a project.

However, they should not be used alone. Instead, they should be used in conjunction with other measures, such as project milestones and project objectives, to get a full picture of the project’s performance.

# Schedule Formulas During the PMP Exam

There are two formulas that are often tested during the Project Management Professional (PMP) Exam: SPI and CPI.

Both of these formulas are important to know for the PMP Exam, for example, you can be tested in:

• Schedule and Budget Contingency
• Cost Collection System
• Change Management Process

Although these are not of them, be sure to memorize the formulas and understand how the earned value works and use them before taking the exam.

## FAQs

### What is SPI?

The Schedule Performance Index (SPI) is a project management tool used to measure the performance of a project against its schedule.

### Why is SPI important during a project?

The SPI can be used to identify potential problems with a project and to take corrective action to get the project back on track.

### What if SPi is less than 1?

When the SPI is less than 1, it indicates that the work is behind schedule, that is to say, that less work has been performed than planned

### What does SPI of 0.75 mean?

For every estimated hour of work, the team is completing 0.75 hours.

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