3 Ways to Help You Measure Your Project Performance
In terms of project management, "success" is defined by a great deal more than just whether or not you were able to deliver what you promised on time. In many ways, success is actually a bit of a moving target, with a large number of variables that you need to keep track of at any given moment.
Measuring your project performance while the project is still going on is also one of the single best ways to improve your processes and procedures for next time, redefining what "success" actually means in a positive way and creating a much more valuable team in the process. There are three key ways in particular that will definitely help you measure project performance.
Measuring Project Performance: Planned Value
One of the most important ways to help you measure your project performance is a metric called planned value. Essentially, this describes the total amount of money that you and your team plan on spending compared to the total amount of work that you plan on doing with that money. To determine this number, take the percent complete at any stage of your project and multiply it by the budget at completion. The higher the number you're looking at, the more value that you're getting for the work that you're doing.
Another important metric that will help you measure project performance is called actual cost. Just because a project was completed doesn't necessarily mean that it was successful - you still may have spent far too much money to accomplish far too little, thus harming the actual project in the process. This metric requires you to take a close look at how much money you actually spend versus the total amount of work that was actually completed.
Cost Performance and Cost Variance
Finally, you'll want to take a look at the overall cost performance of a project to help give you some insight into what you spent versus what you probably should have spent. Subtract actual costs from earned value to arrive at cost variance. If you get a positive result, your project came in under budget. If you get a negative result, your project came in over budget. Even if the project was completed successfully and to the client's expectations, congratulations: you've just found one of the primary areas you need to focus on doing better on next time.
These are just a few of the key ways to help you measure project performance both now and in the future. By constantly looking at things that you could be doing better, you're putting yourself in a much better position to not only meet customer expectations but exceed them at the same time.
- In project management, success is a moving target. There will always be areas that you can improve upon for next time to do better, more efficient work.
- Cost variance is one of the most important metrics that you should be keeping track of. This subtracts the actual costs from the earned value to come up with either a positive or negative number, signifying whether or not you stuck to your budget.