Project manager or not, chances are you’ve heard the phrase, “you can’t manage what you don’t measure.” But even if you fully understand the need to track project data, it can still be tough to determine which project manager performance metrics you should be looking at.
If you get caught in the trap of just using broad categories like “budget” to evaluate how a project is doing (or did), it’s hard to nail down the specifics of what’s going right or wrong. And without these detailed insights, you’re left relying on guesswork to identify project problems and solutions.
By using more granular project management metrics, you can objectively analyze what’s working (or isn’t) across projects. That’s why we’ve put together a list of performance metrics to track. Let’s dive in.
Effectively tracking and analyzing metrics is crucial for monitoring project performance and progress. The right metrics provide visibility into what’s working well and where improvements may be needed. This allows project managers to course correct and ensure projects come in on-time, within budget and delivering the desired business value.
Here are the most important project management metrics to track along with tips for measuring and optimizing each one:
Productivity
Productivity indicates how efficiently your team is converting effort into results To measure
Productivity = Outputs / Inputs
-
Outputs are the tangible work products delivered by the project like lines of code, designs, or test cases.
-
Inputs are the labor resources and costs invested into the project like budget staff time and materials.
A higher ratio signifies greater efficiency. If productivity drops over time, it could signal problems like unclear requirements, inadequate skills or disengaged teams. Consider focused training, adjusting capacity or clarifying goals to improve productivity.
Schedule Performance
This metric evaluates if the project is on track against the original schedule and plan.
- Calculate Schedule variance (SV) to quantify behind or ahead of schedule:
SV = Earned Value (EV) – Planned Value (PV)
-
Earned value (EV) is the amount of work actually completed at a point in time
-
Planned value (PV) is the projected budget for the amount of work scheduled to be completed by that point
-
A positive SV indicates ahead of schedule. A negative SV means behind.
-
Calculate Schedule performance index (SPI) to measure efficiency:
SPI = EV / PV
- An SPI above 1.0 means ahead of schedule. Below 1.0 is behind schedule.
Use these metrics to assess schedule adherence. If lagging, look at adding resources or adjusting timeline.
Cost Performance
Compare actual costs to budgeted costs to identify cost overruns or savings.
- Calculate Cost variance (CV) to quantify over or under budget:
CV = Earned Value (EV) – Actual Costs (AC)
-
Earned value (EV) is the budgeted cost for work completed
-
Actual costs (AC) are the real costs incurred for that work
-
A positive CV is under budget. A negative CV is over budget.
-
Calculate Cost performance index (CPI) to measure efficiency:
CPI = EV / AC
- Above 1.0 is under budget. Below 1.0 is over budget.
Use these metrics to control costs. Look for ways to reduce expenses or get approvals for more funds if over budget.
Quality
This vital metric ensures deliverables meet requirements and satisfaction.
- Calculate Quality score for each deliverable:
Quality Score = Units Passing Testing / Total Units
-
Test units against requirements like features, security, usability
-
A higher score indicates better quality; aim for 100%
-
Calculate Defect density to quantify frequency of defects:
Defects per KLOC = Total Defects / Thousands of Lines of Code
- Lower density is better. Identify root causes of defects to prevent recurrences.
Customer Satisfaction
Gauge client happiness through surveys and direct feedback at project milestones. Sample questions:
- How satisfied are you with the results so far?
- How well are we understanding and meeting your needs?
- What can we improve moving forward?
High marks indicate you’re delighting customers. Low satisfaction signals misaligned expectations or issues to address.
ROI
Measure return on investment by comparing project payoff to costs:
ROI = (Gain from Project – Cost of Project) / Cost of Project
Gain can include revenue, cost savings, productivity gains and other financial benefits. Compare ROI across projects to prioritize efforts with greatest returns. A higher ROI is better.
Profit Margin
For projects donebillable work, track your profitability:
Profit Margin = (Revenue – Costs) / Revenue
Monitor margin over project lifespan. Lower margins could mean underestimating effort and costs. Prioritize improvements to estimating process if margins consistently come in lower than expected.
Team Member Satisfaction
Survey project team members on their motivation levels and happiness. Ask:
- How engaged and motivated are you with your work on the project?
- How well are leadership and processes supporting you?
- What improvements would make you more effective?
High satisfaction leads to greater retention and performance. Address low marks by adjusting workloads, training leaders, improving collaboration tools, or realigning responsibilities.
Tracking and Visualizing Metrics in Project Dashboards
Manually calculating metrics can be time-consuming. Using digital project management platforms automates data collection and analysis. Look for systems offering:
-
Customizable dashboards – Build visual reports with charts, tables and gauges for key metrics.
-
Automatic calculations – Define formulas to automatically compute variances, ratios and other analytics.
-
Real-time data integration – Import data from other systems like billing, testing tools and surveys.
-
Notifications and alerts – Set thresholds to be notified of surpassing targets or unusual variances.
-
Drill-down capabilities – Click into charts to investigate root causes and details.
-
Data exports – Extract data to analyze in spreadsheet or data visualization tools.
With real-time tracking and dashboards, insights into project performance become transparent. Teams can course correct quickly before small issues balloon into major problems.
Tips for Monitoring and Improving Metrics
Here are best practices for tracking project management metrics effectively:
Choose the right metrics – Focus on vital few over trivial many aligned to business goals. Too many becomes unmanageable.
Set targets – Determine acceptable thresholds so it’s clear when intervention is needed.
Automate tracking – Use tools to automate data collection versus manual processes prone to errors.
Make visible – Display metrics prominently in reports, dashboards and team meetings.
Assign ownership – Have metrics “owners” responsible for monitoring and improving.
Analyze regularly – Don’t just collect data; review metrics consistently to identify trends and changes needed.
Course correct – When targets not met, quickly investigate root causes and adjust plans.
Keep improving – Continually refine metrics and processes based on analysis and feedback.
Communicate impact – Share gains achieved to showcase importance with stakeholders.
With a metrics-driven approach, project managers can tap into the pulse of project health. Tracking key indicators makes it possible to maximize productivity, control costs, deliver quality on-time and delight customers. Adopting the right metrics methodology is essential to consistent and successful project delivery.
Gross profit margin
What it is: Gross profit margin is a ratio indicating how much money your company made from a project in relation to how much it spent on the project.
Why you should measure it: On its own, project profit doesn’t factor in how much money your company had to spend to make that new revenue. This can be misleading when it comes to measuring financial performance. By tracking your gross profit margin, you can objectively determine which projects (and clients) are worth the cost of doing business. The higher the gross profit margin, the stronger the return on investment (ROI) is.
How to measure it: (Revenue – Project expenses) ÷ (Revenue × 100) = Gross profit margin
Pro tip: If you’re new to creating project budgets, try our free project budget template.
What it is: Cycle time is the length of time it takes to complete a task, sprint, or project.
Why you need it: Tracking the time it takes to complete different project milestones and the project as a whole gives you hard data for your future project plans. By rooting your timelines in reality and not educated guesses, you can optimize your team’s time and establish deadlines that they and your clients find reasonable.
How to measure it: End date – Start date = Cycle time
What it is: When you measure on-time deliveries, you’re looking at the percentage of timely work delivered in comparison to work delivered past the original deadline.
Why you need it: How often deadlines are being met or missed are critical predictors of project success and client satisfaction. Additionally, tracking exactly which tasks miss the mark and who’s assigned to each will help you identify recurring patterns.
For example, if four out of five delayed tasks were from one team member, it’s a sign to check in and see how you can offer support to resolve any roadblocks. You may consider temporarily reducing the workload of a burnt-out team member or giving them a chance to explore a new type of assignment that aligns with their interests. Or if all five tasks were, say, a specific type of coding, that’s an indication that your team will need more time to complete those tasks in the future.
How to measure it: (Tasks delivered on time ÷ Total number of tasks) × 100 = % of on-time deliveries
Getting started with project manager performance metrics
Every project is different, and as such, you’ll use a slightly different set of metrics for each. But there’s a handful of core project manager performance metrics you’ll always want to keep an eye on to hold yourself accountable and ensure project success.
These foundational data points will give you a clear picture of project performance and help you make proactive improvements throughout the project’s life cycle. First up? Cost variance.
What it is: Cost variance is the difference between your earned value (planned budget) and actual project costs.
Why you should measure it: Tracking cost variance throughout your project life cycle will show you exactly when you’re over or under budget. If you’re over (a negative cost variance), you can take steps to remedy the situation in advance, preventing the nightmare of asking clients for more money. If you’re under budget (a positive cost variance), you can double-check no compromises were made in quality.
How to measure it: Budgeted cost of work – Actual cost of work = Cost variance
Top 5 KPIs for Project Managers [Pay Attention to These!]
What metrics do you need to track?
To determine which metrics you need to track, you have to first think about what goals you want to achieve from the data. For instance, if your aim is to reduce the time spent on projects, you should focus on metrics related to time, project scheduling and productivity.
What are project management metrics?
Project management metrics are indicators used to assess project performance. They focus on everything from productivity and success rates to cost variance, return on investment, timeliness, budget, and conversions. Project management metrics help project managers track progress, evaluate performance, and identify risks.
What are the 8 essential metrics to measure project success?
In this blog post, we will explore 8 essential metrics to measure project success. , such as scope, budget, schedule, stakeholder satisfaction, team performance, risk management, benefits realization and lessons learned.
Why is tracking and acting on project metrics important?
In project management, too, tracking and acting on project metrics are essential for successful execution. These metrics don’t just help you track your projects’ health; they also help control project costs. A study by the Project Management Institute reveals that almost 10 cents per dollar are wasted due to underperforming projects.
