I had a manager once, back in my IT days, who suddenly insisted, “If I get another 12-page project report, I’m tossing it.”
It was too much data to process, so I paired my report down to a 1-page project dashboard that highlighted KPIs for all of my projects. He loved it. And it soon became a template that was adopted throughout the office.
That was 12 years ago. But today, we’re all still facing the same battles with project data overload and trying to cut to the core of our projects’ performance.
Did you know that Primavera P6 Professional has over 200 fields? Many of which are calculated metrics you might choose as a KPI for your project.
So how you do know what metrics to focus on? And what’s the difference between a metric and a KPI in the first place?
Project Metrics and KPIs – Understanding the Differences
In his book, “Project Management Metrics, KPIs and Dashboards,” Dr. Harold Kerzner makes this distinction:
Metrics generally focus on the accomplishment of performance objectives, focusing on “Where are we today?”
KPIs focus on future outcomes and address “Where will we end up?”
Seems simple enough, right? But I’m still a bit fuzzy….What is Kerzner really saying about metrics and KPIs here?
A metric is a simply a measure.
Metrics report on what happened and are generally focused on past events. KPIs are metrics also, but they typically describe a trend and become drivers for decision-making on the future direction of the project.
“With KPIs we figure out how to use this data for decision making in the future. Neither metrics not KPIs can truly predict that the project will be successful, but KPIs provide more accurate information on what might happen in the future if the existing trends continue.”
Thus, a Key Performance Indicator becomes a measure that demands action from the team in order to reset the trend.
There are perhaps hundreds of possible project performance KPIs. Some common examples include:
- Cost Variance
- Schedule Variance
- Cost Performance Index
- Schedule Performance Index
- Number of unstaffed hours
- % of Milestones missed
- Planning cost as a percentage of labor
- Resource utilization
- Earned Value
For KPIs to be an important part of your reporting and controlling activities, you should focus only on a handful that you and your team agree on.
If you find the topic of metrics, KPIs and building dashboards interesting, then I recommend you grab a copy of “Project Management Metrics, KPIs and Dashboards.“