7 Essential Project Performance MeasuresJuly 21, 2015 by Stacey Barr
When we think about measuring the performance of a project, it’s not really the same as measuring the performance of a team or a process. So we need to think a little differently about the kinds of measures that will tell us what we really need to know.
When we measure the performance of the business process or team, we’re interested in how a particular business result produced by that process or team is changing as time goes by. When we’re measuring the performance of a project we are interested in the impact the project has at a point in time, or over a fixed timeframe.
This is because projects by their very definition have a start point and an end point. The reason we do projects is to make a difference and usually the difference we’re trying to make is to make some kind of result, especially in business, better. Thus, our first KPI for projects is…
Project KPI #1: Direct Impact
So the size of this impact on a business performance measure is a measure of a project’s success. It’s the size of the difference between the level of performance before the project’s start time, and the level after the project’s end time. But it’s not the only measure of success.
Project KPI #2 & #3: Bottom Line Impact & ROI
A project won’t be successful if the cost of doing it was not sufficiently lower than the value of the impact. So two other important measures are financial impact, like costs saved or income generated, and ROI.
Project KPI #4 & #5: On-time & On-budget
Measures can also help us manage the project while we’re implementing it. A well-managed project is more likely to have a big impact and big ROI.
This is where the most commonly used measures of project performance come in: on-time and on-budget. And these are measured at regular milestones throughout the project. But they only make sense if we don’t change the goal posts.
Project KPI #6 & #7: Stakeholder Support & Engagement
Support for our project might also be important. Stakeholder perception of value can be measured to monitor this, in part. But a more direct measure of support is the amount of stakeholder participation in project tasks and events.
Your Project Performance Measure Checklist
So we now have a basic framework of measures of the performance of a project:
- Business financial impact
- Business performance measure impact
- Milestones completed on-time
- Milestones completed on-budget
- Stakeholder perception of value
- Stakeholder participation
What frameworks do you use for measuring your projects?
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