We all know that some project managers (those that follow PMBOK/PMP) do earned value analysis to know SPI and CPI.
Schedule Performance Index (SPI) = Earned Value ÷ Planned Value -- How are we doing against the schedule?
Cost Performance Index (CPI) = Earned Value ÷ Actual Cost -- How are we doing against the budget?
I have two questions :
Suppose we have client X and contractor Y.
X wants to build a website and selected Y as its vendor. The contract signed was of type T&M (time & material).
How does the vendor (Y) do Earned value analysis, and how is it different from that of client (X)?
In short, what parameters does a vendor consider while calculating earned value, planned value and actual cost?