About To-Complete Performance Index (TCPI)
The To-Complete Performance Index (TCPI) is a calculated projection of the cost performance that must be achieved on the remaining work to meet recognized business goals, such as the Budget at Completion (BAC) or the Estimate at Completion (EAC).
TCPI is essentially a ratio of the remaining work to the remaining funds. It enables a project manager to determine the level of performance needed to achieve the cost or time objectives.
Based on the BAC, TCPI is calculated as (Budget at Completion minus Earned Value) divided by (Budget at Completion minus Actual Cost). Based on the EAC, TCPI is calculated as (Budget at Completion minus Earned Value) divided by (Estimate at Completion minus Actual Cost). P6 initially sets the BAC equal to the EAC in order to use only EAC in TCPI calculations.
Example: During the course of a project, the project manager (PM) determines that the sum of all the budgets for the work to-date, the total planned value, exceeds the business goals of the organization. The Budget at Completion (BAC) is no longer a realistic goal. The PM develops a projected Estimate at Completion (EAC) that replaces the BAC as the new cost performance goal. The PM uses the forecasted EAC minus AC for the funds remaining denominator in the TCPI equation.
Last Published Wednesday, July 10, 2024