The Cost Performance Index (CPI) in Zoho Projects is an Earned Value Management metric calculated as EV (Earned Value) divided by AC (Actual Cost). CPI above 1.0 means you are delivering more value than you are spending (under budget). CPI below 1.0 means you are spending more than the value delivered (over budget).
CPI can be used to forecast the final project cost: Estimate at Completion (EAC) = Total Budget / CPI. A project with a CPI of 0.8 and a total budget of Rs 10 lakh is forecast to cost Rs 12.5 lakh if current performance continues.
Research by the US Government Accountability Office found that CPI rarely improves once a project has consumed 20% of its budget. Monitor CPI closely in the early phases and take corrective action early, as recovery becomes progressively harder as the project matures.
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