Please correct TCPI formula

Submitted by mdeluze32 on Thu, 08/18/2011 - 03:19

I just found the TCPI formula on following page is incorrect.


http://pmzilla.com/formulas-pmp-pmp


 


12. To Complete Performance Index TCPI
 Values for the TCPI index of less then 1.0 is good because it indicates the efficiency to complete is less than planned. How efficient must the project team be to complete the remaining work with the remaining money?


( BAC - EV ) / ( BAC - AC )
 


 


Above formula should be (BAC - EV) / (EAC - AC)


Please make a correction.


Thanks!

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admin

Thu, 08/18/2011 - 03:59

 On a project, once it becomes clear that the current BAC is not obtainable, the project manager/team develops a new forecast EAC. Once the EAC is approved by the project sponsor, the newly forecasted EAC replaces BAC in the TCPI formula denominator and TCPI becomes: TCPI = (BAC - EV) ÷ (EAC - AC).

 

Analysis of the two TCPI formulas above shows that when using BAC, it is effectively the budget for the remaining work (BAC - EV), all divided by the remaining funds (BAC - AC). TCPI, when using EAC, is still the original budget for the remaining work (BAC - EV), all divided by the remaining newly approved project funds (EAC - AC)

 

Read more here 

http://www.globalknowledge.com/training/generic.asp?pageid=2296&country=United+States