Importance of Project Key Performance Indicator for Successful Project: 5 mins

Project & Key Performance Indicator

Projects are all around us.
Everything that we wear, eat, touch, or use every day is basically an outcome of a successful project to create a unique product. Projects literally run the modern economy and they are managed through project management processes.

Key performance indicator (KPIs) refer to a set of quantifiable measurements used to measure a project’s overall long-term performance. These help the project team to determine whether the strategic, financial, and operational targets of projects are on right track or not.

A project is a temporary endeavor, undertaken to achieve a particular aim in a certain duration, and budget. Every project has a start and finish date with something to deliver under a certain cost.

The project always produces a unique output, and it doesn’t continue forever.
Whereas, Project management is an art and science of getting things done in a given timeline and budget.

An art because there is no one definitive answer for how to best manage a project, and a science because there are well-developed techniques and processes that can help significantly to complete a project successfully.

Project management is the application of knowledge, skills, tools, and techniques to project activities to meet the project requirements.
Sound pretty simple and looks like a piece of cake right!!!

But why Project fails?

However, 9.9% of every dollar wasted due to poor project performance? Based on the survey conducted by PMI,32% of the budget is lost when a project fails to reach its goals. 52% of the completed projects experienced high scope creep.

Have you ever wondered why so many projects fail to meet their desired result? The answer lies in poor project analytics and insufficient tracking of project key performance indicators.

A study has shown that many project managers do not sufficiently keep track of the Key performance indicator of their teams. This results in consistent cost overruns, going over schedule, failing to meet expectations in quality, and seeking new employment elsewhere.
Think about it, what are you managing really if you don’t even know the metrics? Is management merely a process of simply checking off to-do lists for you? It shouldn’t be. Here’s why.

Data is a lifeline for Project Performance measurement

In order for management to make decisions, data is critical.

Data shows and helps you define your benchmarks, and also define forecasts for improving upon baselines for continued company expansion and growth.

Things such as Total Quality Management, Improvement Teams, Standards and Measurement departments, Process Management, Quality Circles, Six Sigma, etc are not just buzz words people.

Devise a system for measuring and quantifying your data and quickly measure the lifeline of your project vis a vis your overall goals. Find out where your bottlenecks are, find out where the cost overruns are taking place, and quickly identify why your Widget sales are declining before it becomes an irreversible money-draining problem.

This allows you then to take action whether hiring an operations consultant to integrate processes, or in the decision to release staff in certain non-critical areas.

Continuous tracking and project analytics

Key performance indicator need to be constantly monitored and measured. Charts, graphs, and summary data need to be reviewed on a regular timetable whether it’s weekly, monthly, or quarterly basis. From then you can then navigate your business or department towards a profitable plateau.

Failure to comply with this very basic performance metrics analysis could result in flushing valuable time, money, employee morale, and reputation down the proverbial toilet if these things are ignored in your project or managerial role.

A rule of thumb is that any system in place for measuring performance metrics is better than having none at all. If you are in a dynamic environment and already have 2 or 3 projects in the air, then feel free to gradually introduce these factors based on your industry line.

Conclusion

Project KPI and analytics are the lifeblood of your project run by project data. Ignoring certain metrics will ensure failure.

Project Management Key performance indicator should be the epicenter of your project analytics rhythms and reviews. Please note that the KPI indicators are prime numbers that matter most to top management and business.

Which Project Management key performance metrics do you use for your project? Let me know by leaving a comment below right now.
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