Performance Measurement and Monitoring

Correct Answer: The project is behind schedule

The primary concern should be that the project is behind schedule. Here's why: The Scope Performance Index (SPI) of 0.76 indicates that the project is progressing slower than planned. An SPI less than 1 means the project is behind schedule. The Cost Performance Index (CPI) of 0.95 suggests that the project is slightly over budget, as a CPI less than 1 indicates the project is spending more than planned. However, the CPI is closer to 1 compared to the SPI. As a project manager, the more critical issue to address is the project being behind schedule, as indicated by the lower SPI value. Delays in the project schedule can lead to further cost overruns and potentially impact the project's overall success.

Correct Answer: Conduct a thorough sprint retrospective to identify bottlenecks, adjust sprint planning, and implement process improvements to address schedule delays while maintaining cost efficiency.

The best answer focuses on conducting a thorough sprint retrospective to identify bottlenecks, adjust sprint planning, and implement process improvements. This approach directly addresses the main issues:

1. Schedule delays (SPI of 0.85)
2. Low team morale
3. Stakeholder concerns

By using the agile methodology's built-in mechanism for continuous improvement (retrospectives), the project manager can:

1. Identify the root causes of schedule delays
2. Involve the team in problem-solving, which can improve morale
3. Implement targeted improvements to increase efficiency
4. Maintain the current cost efficiency (CPI of 1.05)

This solution is proactive and aligned with agile principles, addressing both performance and team issues.

The other options are less suitable:

Increasing team size might help schedule but could negatively impact cost efficiency and team dynamics.

Revising the timeline and budget baseline is reactive and doesn't address underlying issues or improve performance.

Implementing a rigorous change control process may help prevent future problems but doesn't directly address current schedule delays or team morale issues.

The chosen answer provides a balanced approach to improve both schedule performance and team dynamics while maintaining cost efficiency.

Correct Answer: Identify the root causes for the cost overrun and implement corrective measures.

The best answer is 'Identify the root causes for the cost overrun and implement corrective measures'. This is because it's a proactive, problem-solving approach, commonly used in project management. This action promotes understanding what has caused the cost overruns and curtails further occurrence thus bringing project cost in control. It's the project manager's responsibility to manage the project within its defined budget, therefore further increasing the project cost without identifying and tackling any existing issues is not a great strategy. It's also very clear that simply ignoring the problem isn't the correct approach because this will likely lead to further cost overruns and possibly failure of the project. Lastly, canceling the project may not be the best action at this point because 40% of the project is complete and there may be opportunities to rectify the issues causing overruns.