Cost Performance Index (CPI)

The Cost Performance Index (CPI) is a metric used in project management to measure how efficiently a project is using its budget. It compares the value of work actually completed to the amount of money spent. A CPI of 1.0 indicates the project is on budget; above 1.0 means under budget, while below 1.0 signifies over budget. In essence, CPI helps determine whether a project is financially on track and guides decisions to control costs effectively.