This is the approved budget for all the performed project costs and activities completed by a specific date. Your Earned Value, therefore, would be $40,000 (40% * $100,000). Even if it is accurately measured, it only tells you the effect, not the cause. If you bill the designer for 1,200 hours, you would have a realization rate of 80% (1,200 / 1,5000). Management metrics are measurements of the objectives of managers. They are commonly used to measure the value created by a manager for purposes such as performance management.Management metrics may also be used to accomplish management … Including costs from time and materials that have been charges or are scheduled. A primary strength of BrightWork is its reporting capability, including a wide choice of configurable project management performance metrics … This can help you zero in on your most profitable people and projects. The formula for measuring it is as follows: If the result of the above calculation is positive, it means that you’ve earned more value than planned, i.e. This should include everything from salaries to software purchases. Types of Software Metrics. Each project manager typically has different objectives, and metrics that work well for one business might not work for another. The cost of generating revenue at your business. This allows you to identify if the project is running over or under the expected baseline that was originally forecasted. Any metric you measure should be clearly and accurately measurable. The difference between the Earned Value and Planned Value. KPIs let you examine your project’s progress in real dollars, hours, or whatever unit is necessary to … But more importantly, you can use it to calculate other useful metrics as we’ll see below. Danielle Richards Simple, practical, and relevant metrics are vital to implementing practical and sustainable project management practices and processes in any organization. The bigger this number, the better. You can calculate it as follows: For example, a project with an Earned Value of $50,000 and Actual Costs of $60,000 would have a CV of -$10,000. These are not particularly nuanced metrics (delays can be for any number of reasons outside your control), but they do a great job of helping you understand the project at a glance. For example, an on-time delivery rate or the rate of meeting SLA. They are typically calculated on an ongoing basis to provide management with information that can be used to direct and control projects. Any project management … Quality metrics in project management are benchmarking tools that help companies determine whether or not their project management efforts are effective. AGI: FTE, thus, tells you how much money you’re bringing in for each full-time employee in your business. Your project management metrics are used to compare performance over time. However, keep in mind that broad appeal and approval may be easier when metrics focus on customers, with success defined from a business point of view. Project management metrics are specifically used to describe how we can find out how successful a project was. Since it focuses on billable hours, realization rate discounts all the time spent in training, administrative tasks, and in-house work. Compare your Planned Budget vs. Actual Budget at a given point in time. You’ll learn the right approach to use when measuring project performance. Realization rate is a more nuanced metric than utilization rate. There are tons of things you can calculate beyond these such as Net Promoter Score (NPS), Resource Capacity, etc. An insight into the delivery timeline for your project. For example, if you’ve spent $10,000 on salaries and $10,000 on materials in a $100,000 project, your Actual Cost is $20,000 ($10,000 + $10,000). Utilization rate is a measure of the utilization of your resources, i.e. Utilization rate tells you whether you have enough work for your people. Others indicate secondary factors such as risk. After 6 months, you realize that only 40% of the project is completed vs the estimated 50%. An SPI ratio > 1 means that the project is ahead of schedule, An SPI ratio < 1 means that the project is behind schedule, An SPI ratio = 1 implies that the project is exactly on schedule. Regardless of what industry or space you’re in, there are certain metrics set in stone. Billable hours reflect your employees’ time spent specifically on revenue-generating activities (i.e., project tasks). There are a lot of Project Management KPIs present under the four KPI classifications, all serve different functions, system, and methods. A good project management tool should help you get this figure in seconds. Project management is riddled with complications. Similarly, Cost Performance Index (CPI) helps you evaluate how the project is faring in terms of its budget. This is nothing but the realization rate multiplied by the resource’ billing rate. This means if there is ever a change in the metrics you are tracking or how the data is being accumulated, it should be clearly noted in reports. Sylvia joined the Workamajig marketing team in ‘17 & with her background in graphic design & business, she’s an awesome addition. It is a measure of the total billed hours vs the total available billable hours, expressed as a percent. A list of common management metrics. This metric allows you to see all the work that has been done, and at what budget it was completed. Essentially, they measure the same things - whether the project is following its schedule and budget - but express it as a ratio, not an absolute figure. Project Management KPIs Examples. Actual Cost is the third of the baseline metrics alongside PV and EV. Also referred to as: Budgeted Cost of Work Scheduled (BCWS). A robust PM system might tell you how a project is doing at any moment, but it can’t tell you how the organization or its constituent people are performing. Instead, make a list of the top 5-10 metrics for your organization. Measure Project … Keeping track of key performance indicators allows a more accurate understanding of project status, success, and profitability. Billable utilization is a critical concept for firms that make money by billing out resources (people) to customers. See the platform in action, ask as many questions as you'd like, and discuss your specific needs with our friendly and knowledgable sales team. Demos typically run for about an hour. … A business with a 50% margin and profits of $10,000 is healthier than one with 5% margins and profits of $50,000. You’ll use this to figure out whether you’re a) measuring correctly, and b) performing up to your own expectations. Maybe project management isn’t divination, but there are some metrics that can help you plan better for the future. You’ll also learn the top 11 metrics every agency needs to track. Like Planned Value, think of it as a baseline metric you must calculate for all projects. Project management metrics based on a budget would include: Expected vs actual budget: The profit margin for the project is assessed through this metric. While this is an obvious example of metrics that are irrelevant to a project (unless the unit being sold is an umbrella or weather insurance), other irrelevant metrics are collected for projects. These two related metrics tell you how far the project has strayed from its estimated budget and schedule. Billable Utilization: This metric is the percentage of time you can bill to clients. It’s a good idea to calculate the gross profit margin for individual projects, clients, and resources. Privacy Policy. How it helps: Actual Cost gives you a broad understanding of your expenses on a project. Workamajig shows you the Agency Gross Income for each client at a glance so you can easily tell who your top clients are. Your goal should be to maximize your realization rate as much as possible. While Planned Value tells you the scheduled value of the project, Earned Value gives you the actual value. Whatever else you might measure, it is crucial that you measure these three metrics at least. In other words, the project is over-budget by $10,000. Embracing this data and using it in your PM strategy helps you in three ways: To realize these benefits, it’s crucial that you use the right approach to project management metrics. Ask whether it is pertinent to your business, its current situation, and its short and long-term goals. Keeping track of key performance indicators allows a more accurate understanding of project … Instead, if you use proven measurement tools such as NPS (Net Promoter Score) that clients might already be familiar with, your results will be much more accurate. If your priority is raising revenue, for instance, focus on sales metrics, not operations-focused metrics like utilization rate. Select these carefully so that they cover only the parts of the business you care about. At just under 5 feet, Sylvia is a living testament to the adage that good things come in small packages. Instead of a subjective understanding of your agency’s health, these KPIs (Key Performance Indicators) tell you exactly how business, its projects, and its people are doing.