Metrics in Project Management
by Crystal Lee, PMP
Metrics may not be the sexiest subject in project management, but the success of the project management office (PMO) you work in, indeed, perhaps your job as a project manager, may be dependent on whether you have a metrics program in place. In tough economic times, there are even more amazing opportunities for a PMO to prove its real worth to the organization. The information in this article can help you to create your metrics program or assess if your existing program is doing enough to justify your existence.
A metric, by definition, is any type of measurement used to gauge some quantifiable component of performance. A metric can be collected through observation, such as number of days late, or number of software defects found; or the metric can be derived from directly observable quantities, such as defects per thousand lines of code, or a cost performance index (CPI). When used in a monitoring system to assess project or program health, a metric is called an indicator, or a key performance indicator (KPI).
Metrics Management DefinedIntense interest in metrics within the project management community has spawned an entire subfield of study called metrics management. Project metrics can be categorized into three main categories:
- Pure project management measurements (Example: Estimation accuracy)
- Indicators of project success (Example: Stakeholder satisfaction)
- Indicators of business success (Example: ROI).
When reporting metrics to management, it is important to keep the time factor in mind. True success or true failure may not be apparent until long after a project is formally closed. For example, a new software application may turn out to be a colossal failure six months after it is put into production, when it finally reaches its planned usage targets. Examples of macro-level metrics include: number of successful projects, percentage of failed projects, and number of hours spent per project or program. At the micro level, metrics management means identifying and tracking tactical objectives. It is only by looking at the task level metrics that status of higher-level work packages can be ascertained, which can then be reported to project stakeholders and customers. Different types of projects will require different types of metrics—a software development project will call for different measurements than, say, a merger and acquisition transition project. The following criteria are the most common tactical measures people want to be updated about:
|Tactical Measure||Question Answered||Sample Indicator|
|Time||How are we doing against the schedule?||Schedule Performance Index (SPI) = Earned Value ÷ Planned Value|
|Cost||How are we doing against the budget?||Cost Performance Index (CPI) = Earned Value ÷ Actual Cost|
|Resources||Are we within anticipated limits of staff-hours spent?||Amount of hours overspent per software iteration|
|Scope||Have the scope changes been more than expected?||Number of Change Requests|
|Quality||Are the quality problems being fixed?||Number of defects fixed per user acceptance test|
|Action Items||Are we keeping up with our action item list?||Number of action items behind schedule for resolution|
Putting a Metrics Program into PlaceA common saying you may hear about metrics is: “If it cannot be measured, it cannot be managed.” Clearly the lack of metrics can make it harder for a project manager to do the best job possible. At the same time, metrics are useful only if they are just that – useful. Tracking metrics just to have something to put on your status report is not effective use of your time, or your team’s time. If you want to put an effective metrics program in place, set aside time to plan the following items in the following order:
|What information are you going to collect? (Hint: Keep it simple).|
|How are you going to collect the information? (Hint: Keep it easy. Use information already being collected for other purposes.)|
|What methods will you use to process and analyze the information? (Hint: The more actionable the analysis the better.)|
|How and when will you report on the results?|
- Green means “So far so good.”
- Yellow means “Warning – keep an eye on me.”
- Red means “Urgent attention needed.”