Your team has been asked by the construction company owner to develop a high-level dashboard for a construction project. While brainstorming, your teammate says that including the Cost Performance Index (CPI) as part of the dashboard is a must (CPI is Earned Value divided by Actual Cost). How would you respond?
I would respond to my teammate by acknowledging the importance of including the Cost Performance Index (CPI) in the dashboard. I would explain that the CPI is a crucial metric used to measure the project's cost efficiency and performance. By including it in the dashboard, stakeholders can easily track and assess the project's financial health.
I would also suggest expanding on the CPI by including additional related metrics to provide a comprehensive view of cost management. For instance, we could incorporate the Schedule Performance Index (SPI), which measures the project's adherence to the planned schedule. Additionally, including the Variance at Completion (VAC), which represents the expected cost variance upon project completion, would enhance the understanding of the project's financial performance.
However, I would caution that while CPI is an important component, it should not be the sole focus of the dashboard. It is vital to balance it with other critical project indicators such as schedule adherence, quality measures, and risk management. This will provide a more holistic and insightful view of the construction project's progress and help stakeholders in making informed decisions to ensure successful project delivery.