You are managing a large infrastructure project with a 24-month timeline and a $15M budget. During month 14, your Cost Performance Index (CPI) is 0.89 and Schedule Performance Index (SPI) is 0.92. The project has consumed $9.2M of the budget. Your sponsor is concerned about cost overruns and demands that you reduce spending immediately. The critical path activities for the next three months include foundation work that requires specialized equipment already procured and scheduled. What should be your PRIMARY response to the sponsor's demand?

Question

Accepted Answer

The correct answer is A. With both CPI (0.89) and SPI (0.92) below 1.0, the project is over budget and behind schedule. The correct response is to perform a comprehensive EAC analysis to forecast final costs and develop an integrated recovery plan that addresses root causes while protecting critical path work. Option B is the main distractor because while it appears responsive, arbitrarily cutting resources without analysis could further delay the project and actually increase costs through extended overhead. Reducing spending on non-critical activities won't address the fundamental performance issues, and may create new delays that impact the critical path. The project manager must provide the sponsor with data-driven forecasts and a realistic recovery strategy rather than reactive cost cuts.

PMP Practice Question: Process — Predictive, Hard

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