Cost Performance Index (CPI)
EVM Terms
Reviewed by forProject Technology - updated Sep 2026
Quick definition: The Cost Performance Index (CPI) is a measure of cost efficiency: the ratio of Earned Value, or Budgeted Cost for Work Performed (BCWP), to Actual Cost of Work Performed (ACWP).
CPI is a measure of cost efficiency. It is the ratio of the value earned (based on accomplishments) over the amount spent in accomplishing that work. In EVMS terms, it is the ratio of Budgeted Cost for Work Performed (BCWP) divided by the Actual Cost of Work Performed (ACWP). A CPI above 1.0 indicates favorable cost efficiency. A CPI below 1.0 indicates unfavorable cost efficiency. CPI can be calculated for the current period or cumulative to date.
What this means for you
CPI is one of the most closely watched EVM metrics because it helps to identify areas that require management attention. It is a strong early predictor of final cost outcomes and one factor managers weigh when preparing the Estimate to Complete (ETC).
Also known as
N/A
Used in
Estimate to Complete; Estimate at Completion; To Complete Performance Index - EAC comparisons
See also
FAQ
What does a CPI of 1.0 mean?
It means the project is spending exactly what was planned for the work performed — cost performance is exactly on target.
Is a CPI above 1.0 always good news?
A CPI above 1.0 indicates that actual costs are lower than the value of the work accomplished. However, unusually high CPI values could be an indication that actual cost data is missing or being mis-reported and so should be evaluated.
Definition maintained by forProject Technology.
© 2026 forProject Technology, Inc.
© 2026 forProject Technology, Inc.
