Core Banking Migration with Earned Value and Contract Milestones

CPI = EV/AC = 840,000/960,000 = 0.875; SPI = EV/PV = 840,000/1,000,000 = 0.84. The project is over budget and behind schedule. EAC using CPI = BAC/CPI = 2,400,000/0.875 = $2,742,857. TCPI to finish at BAC = (BAC-EV)/(BAC-AC) = (2,400,000-840,000)/(2,400,000-960,000) = 1,560,000/1,440,000 = 1.083. That means remaining work must be delivered about 8.3% more efficiently than the original plan-difficult but not impossible if the overrun is atypical. The six-week critical-path delay explains the SPI; the cost overrun may be from rework or vendor conversion effort. I would validate whether the variance is atypical; if so, a bottom-up EAC may be more reliable. The forecast should be presented with both the CPI-based EAC and a schedule-driven estimate, because the sponsor needs to see that the original go-live and budget are not consistent with current performance.

Neither fast-tracking nor crashing alone recovers six weeks. Fast-tracking testing and conversion in parallel could save perhaps four weeks, but defect leakage in core banking is a high-severity quality and operational risk; the cost of a production defect can exceed the schedule gain. Crashing adds $60,000 and saves three weeks, but only if the contractors can work on the critical path without increasing coordination defects. The data-cleansing change adds four weeks and $180,000, yet it addresses a root cause of conversion delay and should not be skipped. My recommendation: approve data cleansing, crash three weeks, and reject parallel testing/conversion unless a risk-based pilot proves defects can be contained. Together they recover seven weeks, giving one week of buffer, at an added $240,000 plus the existing overrun. Notify the vendor and owner about the impact on liquidated-damages milestones before committing. If the sponsor refuses the cost, present the alternative: keep the original date only by accepting high defect risk or by reducing scope-neither of which I would recommend silently.

The sponsor and steering committee need a transparent forecast: current CPI/SPI, EAC of about $2.74M, six-week critical-path delay, and the fact that the original announced date is not supported by performance data. I would present three options with cost, schedule, quality, and contract consequences: (A) approve cleansing plus crash-best recovery, higher cost, requires change approval and vendor notification; (B) crash only-partial recovery, still late, lower cost; (C) fast-track-possible date recovery but high defect leakage and reputational risk. I need decisions on: approval of the change request and budget, acceptance of residual schedule risk, authorization to notify the vendor about milestone impacts, and agreement on quality gates for conversion. I would also ask the sponsor to manage the marketing announcement rather than forcing the project team to absorb an unrealistic commitment. Document the decision and the accepted risks in the risk register and change log.