Key Highlights
- Project management KPIs are figures that show how well your project is performing based on criteria.
- Some key project metrics that you need to focus on are profit margin, cost variance, and schedule variance.
- Onstro Projects is a multi-functional software that lets you track all your projects on a single platform.
No matter what project you deal with, delivering it at the right time within the allocated resources is your foremost aim. But how can you ensure that? Project management metrics are the right answer to that. Project metrics show how well your team performs on a project.
The statistical figures show the importance of KPI for project management. According to a recent survey, 49% of companies calculate KPIs on a monthly basis. Thirty-one percent check it weekly, while just 20% do it quarterly or less often. Not only does it help you to check the progress of the project but also sets a framework for your team to work towards project success. So, what are the best KPIs for project management? Let’s have a look at that.
What is KPI in project management?
Key Performance Indicators (KPIs) are figures that show how well your project is performing based on a set of criteria. Some prominent project management KPI examples are:
- How long does it take to finish a project?
- How much does a project cost?
- How much income does a project generate?
Also Read: 5 Simple Ways How Resource Management Improves Your Work
5 Key Performance Indicators for Project Management
To make sure that projects get completed within the allocated time and budget, you must keep an eye on the relevant project management KPIs. You might be wondering what is key performance indicators in project management. Let’s check out some important metrics for project management:
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Profit margin
No matter what kind of business you run, profit margin is the driving force behind it. That’s why you need to keep an eye on the profit metrics at each stage of project management. There are two main profit metrics for this: Gross Profit and Net Profit.
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Return on Investment
Is the project worth it? This would be the first thing that comes into your mind while taking up a project. Well, Return on Investment (ROI) is a project management KPI that shows how much profit can be generated by investing in a particular project. This way, you can make sure whether it’s worth it. The ROI is calculated by subtracting the project cost from the financial value, then dividing this number by the project cost and multiplying it by 100.
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Customer Satisfaction Score
Customer satisfaction is one of the most crucial key performance indicators in project management. It is a qualitative measure of how satisfied a customer is with your product or service. Even though each company can set a customer satisfaction rate based on its own criteria, the Customer Satisfaction Index (CSI) is the most commonly used metric. It indicates customer loyalty and the chances of recommending the brand to a friend.
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Schedule Variance
Schedule Variance(SV) is yet another important one that comes under project management performance metrics. It looks at the budgeted cost of work performed and the budgeted cost of work scheduled. Project managers use it to ensure the project gets completed within the fixed budget. It is equal to the amount of budgeted cost of work performed after deducting budgeted cost of work scheduled
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Cost Variance
Like Schedule Variance(SV), Cost Variance is one of the most important project management metrics to make sure that everything works well as planned. It figures out the difference between the estimated cost and the actual cost of the work performed. If there is a huge number, you have to either adjust the project scope or increase the budget.
How do you measure project KPI?
Each business has unique needs and, therefore, sets unique project metrics for evaluation. However, the pattern for measuring those remains the same. Here is a four-step plan for measuring KPIs:
- Set a clear and quantifiable value for the project metrics after considering the preferences of the business.
- Establish a realistic target as to how much you wish to achieve in a month or year.
- Track your metrics correctly with efficient software. You must keep the data in a secured storage space for future reference.
- Periodically review the project metrics and raise them as the capability of the business increases.
Final Thought
Even though tracking project management metrics effectively might sound easy, it is tougher than you think. If you work in a medium or large-sized company, tracking could be too much for a human brain. That’s where you need project management software.
Onstro Projects is a multi-functional software that lets you track all your projects on a single platform. You can set auto-notifications and alert the team members to escalate quickly. Through Onstro, you can update your team members on tasks and deadlines to avoid delays. Contact us now for all-in-one software.
