To ensure that projects are completed on time, project managers need to understand and regularly monitor their project team’s work process. Selecting the right key performance indicators (KPIs) for a project is critical as they will help you measure performance and success. Not only do KPIs provide the quickest way to get a complete overview of your project, they also offer useful insights into areas for improvement.
What’s more, you want to ensure that the KPI’s you use are aligned with your project team and organization. Without KPIs, determining the success of the project becomes a guessing game with no certain way to measure project objectives. Do you need project managers who can keep an eye on KPIs and drive success for your team? PMO Partners, an elite IT project management consulting firm, can help!
Listed below are essential key performance factors that help ensure that potential risks are flagged early on in the process.
1. Costs or Budgeted Cost of Work Scheduled (BCWS)
This important metric (also known as ‘Planned Value’) helps you estimate costs for the project and analyzes if your expenditure is within the planned budget. A simple formula for calculating this is by multiplying percentage of project completed by the total budget.
2. Timeline
It’s important to plan hours required on the project from every team member. The outline of planned hours is then compared with the hours actually worked. The timeline metric helps estimate project duration and alter processes in the event of major discrepancies.
3. Return on Investment (ROI)
This is one of the most important KPIs for projects in that it indicates how well your investment is performing. To calculate ROI, simply divide your total investment by costs. The higher the returns for your company, the better the metric.
4. Schedule Variance (SV)
Schedule Variance helps you track estimates of time and budget. In order to calculate SV, subtract the BCWS value from Earned Value (total spent divided by the total hours worked). A positive result would imply that your project has exceeded the allocated budget.
Selecting the Right KPIs for Your Project is a Challenging but Vital Task
Key performance indicators can provide vital clues that makes it possible to address problems before they turn into major issues. For maximum benefit, project managers should know how to analyze and use the results in the best way possible. While there are no universal remedies to select the right KPIs, it’s a good idea to use those that are measurable and actionable. Now, with the use of project management software, key performance metrics can be managed and updated online. Ideally, KPIs must be clearly identifiable, achievable and quantifiable within specified parameters in order to be suitable for a project.
At PMO Partners, we offer unique and flexible staffing solutions for your IT project requirements. Contact us today to hire project management professionals with the right skills and expertise that you need.
