When we want our client, our team, or our company to know how the project is being executed, we incorporate the so-called Key Performance Indicators or KPIs. In this article, we are going to show you what KPIs are and what they are for. Are you ready?
What is a Key Performance Indicator?
Key Performance Indicators are also called KPIs. These Performance Indicators are a series of metrics that are used in project controls to synthesize our project. The idea is to synthesize in a control panel or dashboard all the information of our project related to the efficiency and productivity of the tasks that are carried out in order to help us make better decisions.
What are KPIs for?
KPIs allow the project team to measure its progress and track performance focused on previously defined objectives. The most appropriate way to display the Key Performance Indicators is through a balanced scorecard. The ultimate goal is to be able to make better decisions during the execution of the project since they will help us to see the trend of the project units under control.
Examples of KPIs in project management
Within a project, you can have very varied KPIs, such as sales KPIs, logistics KPIs, production KPIs, engineering performance indicators, and even health and safety KPIs. Some examples of KPIs would be the concreting ratios, excavation ratios, the health of the project schedule, and the EVM or Earned Value Management. Your experience as a Project Manager will help you choose the best performance indicators for your project.
KPI indicators to measure your schedule
Problems in the execution and health of the activity schedule may include the following points:
- Comparison between the activities that you start and finish with the number of activities that were expected to start or finish in a given period
- Summary of activities in progress
- Percentage increase in the duration of activities
- Number of additional activities or deleted activities
- Any other type of indicator that explains and represents the progress and execution of the project
What is a Key Performance Indicator within Earned Value Management
We will now explain to you why KPIs are so used within the EVM. Earned Value Management or EVM combines project scope, activity schedule, and cost measures within an integrated system. This system provides us with indicators based on cost. The application of Earned Value Management analysis during the early stages of the project increases the validity and effectiveness of the project baseline, both at the level of activities and cost. Once established, the project baseline underpins understanding of project performance during project execution.
Earned Value Management can be expanded to include the concept of an earned schedule, which provides time-based indicators to complement the cost-based indicators used during project execution.
IN PROJECT 2080 WE WOULD LIKE YOU TO REMEMBER
Now that you know why KPIs are so important elements within a project, you should learn to identify the performance indicators that best fit yours. Do not forget that the Key Performance Indicators can be used to measure from the progress of a work unit, such as the poured concrete or the kilos of corrugated steel that is placed daily, to the number of casualties due to work accidents or the number of accidents without serious consequences within our project. Remember that absolutely everything is measurable in a project. You just have to find the metric that best suits yours, that is most relevant and that best helps you synthesize the data. Your experience as a Project Manager or as a Project Controls Manager will be of great help to identify the best indicators.