Would you drive a car without a dashboard ? Without a speedometer, without a fuel gauge and without even having studied the route beforehand?
If this exercise seems complex or even dangerous, consider that managing a project without KPIs is like that. Of course, the consequences are not of the same magnitude. On the other hand, this deliberately impactful example illustrates the importance of using KPIs to manage your projects.
To see the benefits, you need to learn how to use them appropriately.
We have therefore designed this guide to help you maximize the use of KPIs in project management, also considering the monitoring indicator as a key element.
1. Project management KPIs: what are they?
A KPI, or Key Performance Indicator, is a performance indicator. It usually takes the form of a number or percentage.
Its use makes it possible to measure the progress of the project and to facilitate decision-making, acting as a real monitoring indicator.
2. Choose suitable and relevant project management KPIs
A) Make an assessment
Taking stock of your project and your capabilities as a company is a necessary step in choosing KPIs.
You must identify precisely:
- The progress already made on the project
- The data you have or may have
- Collection and processing tools at your disposal
- Resources for KPI analysis
Collecting KPIs involves being able to read, analyze and interpret them. KPIs are still tools that are supposed to help you manage your project, and reading them generates adjustments and corrections.
B) Determine objectives
KPIs are effective indicators, whichare based on objectives. Otherwise, they become what are called "vanity metrics", which only serve to flatter the ego without helping with project management.
Take the time to define what you want to achieve with their use. Here are some questions to help you identify goals:
- What are the expectations of stakeholders regarding the results of the project?
- What indicator will define my project as a success?
- What are the potential risks to my project?
- What is the optimal frequency for measuring KPIs to ensure effective responsiveness?
C) Identify the data to be measured
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SMART method
Once you've determined your goals, you need to define the data that will be measured.
These must be specific, measurable, achievable, realistic and temporarily limited. Otherwise: SMART.
Make sure your KPIs meet these requirements:
- Linked to a goal
- Understandable by all employees who will be required to use it
- Customized to the needs of your business and especially your project.
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Reducing your selection to the bare minimum
Collecting and using a KPI in project management consumes resources. This requires time and collaborators: collection, processing, reading, analysis...
Therefore, avoid choosing a KPI because your colleagues or competitors use it.
If a KPI is not useful for your project management, there's no need for it! Choose KPIsthat are truly suitedto your project. Note that the more indicators you follow, the more itcomplicates your projectand increases your workload.
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The 3 groups of KPIs
As mentioned in this article on the definition of evaluation criteria, measuring the performance of a project requires 3 criteria: quality, deadlines, costs.
💡 Scroll to the right to see the 3 KPIs
1. Quality KPIs
These indicators measure the degree of satisfaction of customers and employees.
Here are some examples of quality KPIs in project management:
- Customer satisfaction
- The Net Promoter Score
- The number of errors
- The number of complaints
- Employee turnover
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2. Lead time KPIs
Like costs, deadlines are often studied under the microscope to measure the success of a project.
Here are some examples of KPIs to measure deadlines in project management:
- Time spent
- The rate of delay
- Resource capacity
- Planned hours vs. hours spent
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3. Cost KPIs
Costs are often the most decisive element for the success of a project. We have dedicated this article to presenting 12 financial indicators for project management.
Here are some examples of KPIs to measure costs in project management:
- The budget gap
- The real cost
- Return on Investment (ROI)
At Stafiz, we have developed our tool to facilitate the measurement of KPIs deadlines. For example, we help you go further by allowing you to measure the rate of completion and the rate of completion of tasks.
For us, invoicing is an integral part of project management. However, this aspect is often neglected. We offer you an indicator to identify everything that can be invoiced to date, and everything that remains to be invoiced.
In the same way, we are aware that costs are one of the most strategic indicators. We have therefore particularly developed this aspect by allowing you to monitor and control your costs :
- Calculation of project profitability thanks to gross margins, net margins, margin rate indicators. To find out more, see our article dedicated to calculating profitability
- Calculation of the turnover forecast thanks to the progress forecast
- Calculating production versus invoicing
- Presentation of income statements for a specific and consolidated activity
In addition, we offer a granularity that allows you to analyze the details of costs by project, by team, or by department.
Learn more about KPIs in Stafiz
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Observe certain precautions
Make sure the team is ready to work with your chosen KPIs.
Take the time to talk to your employees. You need to be sure that they understand the indicators they are using and that they see the value of working with these tools.
Also, be sure that you can get the selected KPIs. Indeed, they must be a reliable source of information on which to rely. This may require specific implementation:
- Setting up collection tools
- Creating dashboards
- Collaboration with other stakeholders (e.g. technical teams)
3. Implement a follow-up strategy
A) Set goals
You've already set goals for selecting your KPIs.
Here, it is a question of defining objectives to support the implementation of your monitoring strategy.
What are the motivations that drive you to track your KPIs? Like what:
- Improved delivery time
- Reduction in the cost of production
- Improving quality delivered
- The development of a specific skill in an employee
B) Choosing the right tool
Once your objectives have been established, you will be able to list your needs in order to compare and select the tool that meets your needs. Consider the following:
- The features offered
- Ease of use and deployment
- The level of support available: the implementation of certain software requires heavy skills and support may be necessary
- The price
At Stafiz, our strength of proposal lies in the design of an interface adapted to several levels:
- Project management
- Project portfolio management
- Program Management
Centralizing information provides global visibility : it avoids the need for manual tracking from different sources. Often time-consuming, it is also tedious and imprecise.
Finally, we offer dedicated support to help you clarify your needs and configure the tool according to your expectations.
C) Driving on a daily basis
Day-to-day management is the whole point of monitoring KPIs in project management.
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Build dashboards
Dashboards will prove to be valuable tools to manage your projects thanks to KPIs. Indeed, they make it possible to group KPIs, to make them readable, visual, to put them in opposition or to provide more context by associating them.
To learn more, check out our article on creating dashboards for project management
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Gain a consolidated view
At the micro level, KPIs will allow you to identify your progress in terms of deadlines, costs and objectives. At Stafiz, we have designed the product to provide you with an aggregated view of this information. This is particularly useful for programme or portfolio management. The idea is to provide you with the necessary information to help you organize and optimize your resources.
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Piloting projects gathered in a program
This organization consists of managing a set of projects that are interconnected to the service and in alignment with the company's strategic objectives.
Stafiz thus makes it possible to group several projects into one program and helps in particular to consolidate financial and billing data.
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Managing a portfolio of projects
For the management of a project portfolio, Stafiz offers a global view of the situation. You will be able to identify:
- Projects that deviate from time
- Projects that deviate at the margin level
- Projects that deviate at the task level
This view of project portfolios makes it possible to compare the performance of one project against another. By analyzing what works and what, on the contrary, does not achieve the expected results, you are part of a continuous improvement process.
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Coordinating human resources
Management, optimization of resources and employee satisfaction are strategic aspects of project management.
Stafiz has therefore developed features to meet this need:
- Resource allocation and planning
- Notification and improvement of employee visibility.
Information is better distributed. Thus, the management of views allows everyone to have the right information according to their scope and their rights. Each employee is therefore given more responsibility.
D) Make informed decisions and adapt
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Gain visibility
Managing on a daily basis offers all the necessary skills to be flexible and adapt in order to lead the project to success.
Stafiz allows for increased responsiveness because the tool facilitates access to reliable and accurate data, all calculated automatically. This way, everything happens in real time: you get an immediate overview of the status and the risk of deviations. Regular monitoring remains essential to identify what is working and what could benefit from improvement.
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Be flexible and responsive
A project is bound to evolve. As a project, program, or portfolio manager, your role is to identify areas for optimization.
There are some indicators that can help you in this process. Assessing the gaps between the forecast and the actual (both in terms of time, budget or resources) will help you optimize your strategy.
Maximizing the use of KPIs in project management requires a precise definition of your objectives as well as several strategic choices.
Identifying KPIs adapted to your project and choosing the right tool for your needs can be a real challenge. Meaningful use of KPIs requires intense preparation, precise inventory and constructive collaboration.
That said, strategically chosen, collected and analyzed KPIs will allow you to manage your activities in order to adapt your strategy. At Stafiz, we have taken all these criteria into account in order to build a complete, flexible and efficient product for your project management.
