What are project management metrics?
· 3 mins read
In every project, the team has the opportunity to learn something. That’s why metrics are an important factor in project management to measure success and analyze execution. Whether for customer projects or internal projects, the metrics help measure the results of the project. In addition, the projects provide the opportunity to optimize the team’s processes and achieve more efficient results.
But how? This is possible through the measurement and analysis of project management metrics.
Why are project metrics important?
Key performance indicators are an effective way to measure and evaluate project progress. Through measurement, you can optimize management processes and certain factors can be included. This gives the team a chance to track performance and make optimizations as needed.
What are the benefits?
With the right metrics, you as a Project Manager get insights into the performance of the team, both from a higher-level and individual perspective. This allows you to analyze workflows and identify and optimize inefficient processes. The goal of this is to be able to improve future project performance.
Collecting this data and information is useful when you want to review project management performance. This is because the more data there is, the more accurately success can be measured and demonstrated.
This is especially important if you are in charge of the team. You can therefore contribute to the success of the entire company with the key figures.
So the benefits are as follows:
- Optimized performance of the team.
You can secure the team level and improved through proactive management. The metrics provide more security to the team and help to make better and more informed decisions.
- Measure the productivity of the team
Project management metrics can improve productivity. With metrics like OTD (On-Time Delivery) you can measure and improve the project.
- Track progress
To identify obstacles early and make sure there is enough time to make corrections and adjustments, metrics in project management are helpful.
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5 Key project management metrics for Project Manager
Depending on the complexity and the goal of a project, different project management metrics can be defined. The most important ones are the following:
This metric allows project managers to assess how resources are used. The total effort is compared to the budgeted effort. If there are delays, problems with suppliers, or unavoidable circumstances, this can affect this metric. The ratio can be used from project to project and also on an organizational level. It defines the relationship between input and output. The goal is that as little input as possible achieves as much output as possible.
2. Scope of Work
The scope is usually defined beforehand, nevertheless, changes and additions can complicate this. The scope includes both the goals and the individual tasks needed to achieve the goals. Keeping track of requests for changes is important so that the timeframe and budget can be kept in the product and controlled. It is also important to ensure that everyone on the team understands the objectives.
Cost indicates the total amount needed for a project. You do this by adding up all the individual costs. Measuring them is a crucial aspect of project management. Cost is related to many other variables such as quality, scope, or productivity. If you calculate the costs incorrec and they are either above or below projections, problems can arise. The best-case scenario is to keep an eye on costs throughout the project. This is because if there are unexpected costs, other variables will need to be adjusted to meet the goals of the project.
4. customer satisfaction
This measures the quality of a product or service. You can do this, for example, through customer surveys. The products or services should serve a specific purpose. This can be monitored through revenue, repeat customers, complaints, or customer surveys.
5. return on investment (ROI)
Return on Investment refers to the value of the project results compared to the amount spent on implementation. This can be expressed as an equation: ROI= (net benefit/cost) x 100. Each benefit from the project is assigned a value. This could be cost savings, improvements, or a contribution to profit. Using the previously mentioned formula, they can then calculate the return on investment of the project.
Choosing the right metrics
1. simple and relevant
All project management metrics used should be easy to measure, easy to understand, and relevant to the objectives and the business.
Metrics should be accurate and measurable. They must not be ambiguous, as this will only lead to confusion and inconsistent analysis.
3. real data must be available
Metrics must be able to be explained by data. Before selecting the metric, consider whether data exists for it and how it can be verified.
Implementing the metrics
Once you have defined the metrics for the project, they need to be implemented. It’s best to communicate with stakeholders so they understand the importance and how you can use the metrics to improve performance. Give stakeholders clear examples, such as: here’s where you see delays in getting information.
You can create a plan, where you show the key metrics in project management and everyone can see and understand them. Goals and strategies on how to achieve the goals can also be listed there. When everyone has an understanding of this, implementation can begin.