Date of Award

3-14-2014

Document Type

Thesis

Degree Name

Master of Science

Department

Department of Systems Engineering and Management

First Advisor

Jonathan D. Ritschel, PhD.

Abstract

The concept of a Cost Performance Index (CPI) stability rule originated with the seminal article from Christensen and Payne in 1992 and has become routinely cited by subsequent academic literature and EVM authors. A literature review reveals that the definition of what constitutes stability has morphed over time, with three separate definitions of stability permeating the literature. Additionally, while the original Christensen research found the cumulative CPI to be stable in 86% of DoD contracts (from 155 analyzed) at the 20 percent completion point, more recent research from Henderson and Zwikael (2008) questioned the generalizability of these findings. This research reexamines the question of CPI stability in a modern portfolio of DoD contracts utilizing all three definitions of stability. Next, this research examines potential stability in the Earned Schedule SPI(t) metric. The second stage of this research investigates whether there is a difference in CPI or SPI(t) stabilities between military services, contract types, acquisition life-cycle phases, or platforms. Comparison analysis executes tests on the median stability value for each category of contract. This research finds that CPI stability both contradicts and supports the stability rule depending on the stability definition used. The SPI(t) exhibits similar stability traits to CPI stability.

AFIT Designator

AFIT-ENV-14-M-49

DTIC Accession Number

ADA600346

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