Christian holds a BSc in Psychology with an emphasis on organizational management and is the current Head of Operations for Eleven Media, where he oversees…
Amy Clark is a quality-driven managing editor who has extensive knowledge of the SaaS market. She started her journey managing and supporting the content at…
Knowing the project management KPIs you absolutely need to track and how to measure them is key to every project’s success. From cost and planning project KPIs to time and quality metrics, these are the top 20 key success factors every project manager needs to measure success — and we show you exactly how to measure them.
What are Key Performance Indicators in Project Management?
Here’s the best way to define project management KPIs: A KPI is a quantifiable measure used to evaluate a project’s success, both in its final outcomes and in its execution.
A Key Performance Indicator serves as a clear, standardized, simplified snapshot or view of a given business process or undertaking at a single point in time.
A project KPI helps project managers gain greater control over their projects, insight into their team’s operations, and successfully ensure projects are completed on time and within budget.
Tips for Getting the Most Out of Your Project KPIs
Follow these project management KPI tips for the best results:
Alignment to Strategic GoalsEncourage Stakeholder OwnershipUse Quantitative and Qualitative KPIsCompare KPIs Across ProjectsUse Visualization Tools
KPIs for project management are essential in guiding decision-making, but to be effective, they must line up with the company’s or project’s strategic goals.
As a project manager, you must think carefully about which KPIs make the most sense for your project and, in some cases, how to measure progress.
KPIs are only accurate and effective when data is collected diligently and precisely. Assign KPIs to specific stakeholders or project team members and make them accountable for those metrics.
While figures related to dollar amounts are easy to calculate and compare, qualitative feedback gathered from team members, customers, and stakeholders through regular check-ins, retrospectives, forms, surveys, and even behavior offers valuable insights into project management.
All the KPIs given below can be “normalized” by dividing the result of the calculation by a company-wide average. This can offer tremendous insight and helpful context to project managers and those who sit above them.
The insights KPIs unveil in project management are usually most apparent when visualized as a graph or chart. You can use business management software to create compelling, informative visualizations to ensure you meet your strategic objectives.
20 Key Project Management KPIs: Overview
Here’s an overview of the 20 key project management KPIs we’ll be covering in some more depth in the sections to follow:
PlanningCostStakeholdersTimeQuality
Budget Creation or Revision Cycle Time
Project Charter Approval Time
Resource Allocation Efficiency
Risk Identification
Planned Value, Earned Value, and Actual Cost
Schedule Variance
Budget or Cost Variance
Cost and Schedule Performance Index
Profitability Index
Return on Investment
Stakeholder Satisfaction
Stakeholder Engagement
Employee or Team Churn Rate
Cycle Time
On-Time Completion Percentage (tasks, milestones)
FTE Days vs Calendar Days
Number of Errors
Quality Control Rating
Customer Satisfaction
Churn Rate
Planning KPIs
When it comes to project management KPIs, here are the key ones worth tracking and how you’d go about doing it as a project manager:
1. Budget Creation Cycle Time
The BCCT is the time taken to create the project’s budget, including research, planning, discussions, and agreement.
A low cycle time indicates that the project manager clearly understands the costs and has successfully conveyed these to stakeholders, who are likewise well-aligned.
How to Measure it
Budget Creation Efficiency (BCE) =Actual Time Taken / Goal Time x 100%
You can measure cycle time in hours, days, or weeks, with your goal being a corresponding time (for example, 20 hours or 5 days).
You can further quantify this as a percentage of the Actual time divided by the Goal time. This will give you a good indication of how far below, on, or beyond your target you are.
Lower is better.
2.Project Charter Approval Time
The PCAT is the duration from the charter creation to its approval, typically in days.
A longer charter approval time suggests there are fundamental issues with the charter or particular project or that stakeholders are either not aligned or too busy on other tasks to participate effectively.
How to Measure it
Project Charter Approval Time =Date of Approval – Date of Charter Creation x 100%
As with budget cycle time, you can set a specific goal in hours, days, or weeks and optionally divide Actual time by Goal time for a single figure indicative of success.
Lower is better.
3.Resource Allocation Efficiency
The RAE retroactively measures resource utilization, which is how effectively resources (human, technological, financial) are allocated and scheduled during the project’s planning phase.
A good understanding of your resource capacity and allocation is critical for reducing waste and ensuring the project moves on time and within budget.
How to Measure it
The actual measurement will be performed during the execution phase by comparing planned versus actual resource allocation and use. Common measurements include:
How accurately did we predict how long tasks would take? = Actual Time Spent on Tasks / Forecasted Time x 100%
Closer to 100% is better; higher means we spent too much, and lower means we’re under budget ??but our prediction was inaccurate ??.
How accurately did we predict expenditure? = Actual Expenditure / Projected Expenditure
Same as above. Closer to 100% is better.
How accurate was our expected schedule? = # of tasks started and finished in the expected time / total # of tasks x 100%
Higher is better; 100% means all tasks started and finished on time.
To what degree has the project suffered from delays? = (Total delays on tasks / Total planned project time) x 100%
Lower is better; 0% means no delays; 100% means the project has taken twice as long as scheduled. Another way to think about it is in terms of hours:
At 0.50 or 50%, for every hour scheduled, you’ll have accrued 30 minutes of delay.
4.Risk Identification
Retroactively measures your success in identifying potential risks during the planning phase.
All projects encounter delays and obstacles, and a project manager’s ability to foresee the nature, number, and duration of these is critical to ensuring the project plan is reliable.
How many of the risks initially identified in the planning phase materialized throughout the project lifecycle?
RIR = Identified Risks that Occurred (IRO) / Total Identified Risks (TIR)
The higher the RIR, the better, as it indicates greater accuracy in identifying potential risks.
How many risks occurred that weren’t anticipated? URR = Unidentified Risks that Occurred (URO) / Total Actual Risks (TAR)
The lower the URR, the better, as it indicates fewer risks appeared that we didn’t successfully anticipate.
Combining the above two concepts, RPA compares the number of identified risks that occurred to the total risks that occurred. RPA = Identified Risks that Occurred (IRO) / Total Actual Risks (TAR)
Higher is better because we hope that the risks we identified, and only those risks, occur.
First, let’s start with some basic measurements, known as Planned Value (PV), Earned Value (EV), and a project’s Actual Cost (AC). These financial KPIs don’t provide much insight on their own.
However, we can compare them to obtain other important project KPIs, such as Schedule Variance (SV) and Cost Variance (CV), which we’ll see below.
5.1. Planned Value
The PV – Planned Value, or Budgeted Cost of Work Scheduled (BCWS), refers to the scheduled or expected project work completed at any given point in time.
How to Measure it
You can measure PV in two ways:
PV = Expected Remaining Hours x Average Hourly Rate
PV = Expected Remaining % of Tasks to Complete x Project Budget
For example, suppose you have a project with a budget of $9,000 or 240 hours to be completed over six months. After two months, you should have completed one-third of the project:
Scheduled Hours x Average Hourly Rate 80 hours x $37.50 per hour =$3,000
Expected Remaining % of Tasks to Complete x Project Budget 33% x $9,000=$3,000
The Planned Value at this point is $3,000.
5.2. Earned Value
The EV, or Budgeted Cost of Work Performed (BCWP), represents the budgeted value of the work actually completed up to this point.
How to Measure it
You can measure EV in the same fashion:
EV = Actual Remaining Hours x Average Hourly Rate
EV = Actual Remaining % of Tasks to Complete x Project Budget
Using the scenario above, suppose we’ve completed half the project after two months. Earned Value is given as:
Actual Remaining Hours x Average Hourly Rate 120 hours x $37.50 per hour = $4,500
Actual Remaining % of Tasks x Project Budget 50% x $9,000 = $4,500
5.3. Actual Cost
The AC, also called the Actual Cost of Work Performed (ACWP), indicates the actual expenditure on the project at a given point in time (as opposed to the scheduled costs used in PV and EV).
It differs from Earned Value in that EV is based on the budgeted value of the work as compared to the actual cost. This could differ if, for example, work had to be shifted from one stakeholder to another, both of whom are on different hourly rates.
EV is based on your project plan and AC is on actual expenditure.
How to Measure it
Add together all the costs incurred for the project so far. AC = ∑(Individual Expense Amounts)
6. Schedule Variance
EV and PV alone don’t offer much insight into your project. By comparing them, though, we can get a quick snapshot of whether we’re ahead or behind schedule.
This snapshot is Scheduled Variance (SV)
How to Measure it
SV = Earned Value (EV) – Planned Value (PV)
In this scenario, our Earned Value ($4,500) is greater than our Planned Value ($3,000), so we’re ahead of schedule. However, it indicates that the planning phase wasn’t as accurate as it could have been.
7. Budget or Cost Variance
Budget Variance or Cost Variance is the difference between the EV or Budgeted Cost of Work Performed (BCWP) and the AC or Actual Cost of Work Performed (ACWP).
Here, we compare what we expect to have spent at a given point in time to the actual budget spending. EV and AC can vary for many reasons.
For example, if work is shifted from one stakeholder to another, both of whom are on different rates, the actual (AC) and expected (EV) expenditure will differ.
It’s important to track project management KPIs like BV, as it’s useful in assessing the financial performance of a project, indicating whether it’s above or below budget.
How to Measure it
Subtract Actual Cost from Earned Value: BV = Earned Value (EV) – Actual Cost (AC)
If BV is positive, the project is under budget; if it’s negative, it’s over budget. So, when keeping track of this KPI, higher is better.
8. Cost and Schedule Performance Index
Indices are similar to variance, except that instead of subtracting actual from expected values, you divide the two values. This offers a simple way to compare projects and establish company-wide KPIs.
How to Measure it
Schedule Performance Index = Earned Value (EV) / Planned Value (PV)
In terms of project schedule, if SPI is greater than 1, the project is ahead of schedule. If it’s less than 1, the project is behind schedule. If it is equal to 1, the project is exactly on schedule.
Cost Performance Index = Earned Value (EV) / Actual Cost (AC)
If CPI is greater than 1, the project is under budget. If it’s less than 1, the project is over budget. If it’s equal to 1, the project is exactly on the planned budget.
9. Profitability Index
Also called the Value Investment Ratio (VIR) or Profit Investment Ratio (PIR), PI represents the ratio between the present value of expected future cash flow and the initial investment in a project.
It’s typically used before a project starts to determine the best course of action. For accuracy, expected future cash flow must be discounted at a rate equal to how far in the future it’s expected since cash in hand today is more valuable (thanks to interest).
How to Measure it
The formula is somewhat complicated but is easily calculated with any number of free online calculators like this one.
If PI is less than 1, the project won’t be profitable. If PI is greater than 1, the project will be profitable. If PI = 1, you neither lose nor gain money (zero profit), which is also undesirable.
Suppose, for example, that a company is deciding which features to add to its software and wants to prioritize according to profitability. There are five new features requested by customers:
Feature
PI
Customizable dashboards
1.05
Add a dark mode
1.11
Allow white-labeling
1.74
End-to-end encryption
0.97
Automated reporting
1.12
White-labeling, automated reporting, and dark mode offer the greatest PI. The company will likely start with these. End-to-end encryption, for now, isn’t profitable.
10. Return on Investment
The most common profitability formula, Return on Investment (ROI) compares the net profit made on an initial investment. It offers a way to compare the performance of different investments, including projects.
How to Measure it
ROI = Net Profit / Cost of Investment
An ROI greater than 1 indicates a profitable investment; a negative ROI indicates a loss on investment; and an ROI of 1 indicates no profit (also undesirable).
Overall, the higher the number, the better.
Stakeholder KPIs
Managing stakeholders is among the most common project management challenges faced by PMs. These are the key project management KPIs you’ll want to ensure you’re using in 2024 when it comes to your project stakeholders:
11. Stakeholder Satisfaction
The SS measures the satisfaction levels of stakeholders, whether employees, managers, or directors. This is subjective and can be measured in various ways, including surveys and interviews.
The key is to ask specific, relevant questions that cover all aspects of an entire project. This could include overall satisfaction, satisfaction with communication, project progress, deliverables, and more.
For example, you might ask:
“On a scale of 1 to 10, how satisfied are you with the current project communication?” or
“On a scale from 1 to 5, how well do you feel project objectives are being met?“
This is a good, indirect project KPI to measure frequently, as changes in stakeholder satisfaction can announce issues with the project before they otherwise become apparent.
How to Measure it
The simplest way to measure stakeholder satisfaction is by taking the average or weighted average of responses to questions like those above.
You can weigh them according to importance (for example, their satisfaction with progress may be deemed twice as important as their satisfaction with communication).
SS = Sum of All Satisfaction Scores / Number of Responses
For a weighted average, let:
Qi = Score from a question i
Wi = Weight assigned to question i
n = Total number of questions
SS = (W1 x Q1 + W2 x Q2 + … + Wn x Qn) / (W1 + W2 + … + Wn)
Higher is better.
12. Stakeholder Engagement
SE measures the degree of stakeholder involvement and commitment to the project during the initiation phase. High engagement indicates effective communication and strong commitment from those involved with the project.
How to Measure it
Stakeholder engagement can be quantified by meeting attendance rates (e.g., 6 attendees out of 9), feedback responses, stakeholder survey scores, or a similar method.
However, attendance rates are the easiest to quantify and a fairly good indicator of stakeholder engagement.
Stakeholder Engagement Level = Numbers of Attendees / Total Number of Stakeholders Invited x 100%
You can do this for each meeting to get an overall score. You can perform a similar calculation for individuals to see what their engagement level is:
Individual Stakeholder Engagement = # of Meetings Attended / Total Number of Meetings x 100%
Lower is better.
13. Employee or Team Churn Rate
The ECR or TCR measures how frequently employees or team members leave or are replaced on a project team. A high churn rate indicates serious issues with management, communication, project expectations, or something else.
How to Measure it
Divide the number of employees or team members who leave or are replaced by a given time, such as one month.
ECR = Number of Employees Lost / Total Number of Employees at Start of Period
Time KPIs
Time is money. Here are the key KPIs for project management related to time and how to measure them yourself:
14. Cycle Time
Cycle Time measures the time required to complete a specific task or activity within the project. It’s crucial for identifying inefficiencies and ensuring your project stays on schedule.
Shorter cycle times suggest operational efficiency and good resource use. You can calculate cycle times for individual tasks, key objectives, and the project as a whole.
How to Measure it
Subtract the end and start dates of the task, objective, or project: Cycle Time = Task End Date – Task Start Date
15. On-Time Completion Percentage
OT measures the percentage of tasks completed on or before their due dates. A higher overall rate suggests proper planning and swift execution; a lower percentage indicates that many tasks are encountering issues and causing delays.
How to Measure it
On-Time Completion Percentage = (Number of Tasks Completed On Time / Total Number of Tasks) x 100%
16. FTE Days vs Calendar Days
This project KPI explains the difference between full-time equivalent (FTE) days and actual calendar days taken to complete a task or project.
FTE vs Calendar Days provides insight into your project teams’ efficiency and can inform realistic timeframes for tasks, especially when you’re working with part-time employees and contractors.
How to Calculate it
Calculate the total number of FTE days spent and compare it to actual calendar days passed so far or at the end of the project duration.
FTE Days vs Calendar Days = Total FTE Days Spent – Actual Calendar Days Passed
Quality KPIs
Tracking project KPIs related to quality is vital to meeting your project goals. Here are the key ones and how you can measure them:
17. Number of Errors
The NE quantifies the number of mistakes or errors in a project over a given time. For example, in software development, it could refer to bugs found in code.
How to Measure it
Count all identified mistakes during a period: NE = Total Count of Identified Mistakes
18. Quality Control Rating
The QCR evaluates the overall effectiveness and efficiency of quality control measures. It can be calculated using metrics such as defect rates, compliance levels, and audit results.
How to Measure it
QCR = Σ(Ri x Wi) / Maximum Possible Score
This will vary widely depending on your quality control methods. However, a general approach is as follows:
Define clear quality criteria and assign weights to each based on importance.
Rate each quality criterion on a consistent scale (e.g. 1–10).
Multiply each rating by the respective weight.
Sum all the weighted ratings.
Option: Normalize the sum to a desired scale by dividing by the Maximum Possible Score.
19. Customer Satisfaction
The CSAT measures the average level of customer satisfaction with the project’s deliverable, such as a feature or product. There are numerous ways to measure this for future projects.
High levels of CSAT are essential for maintaining loyalty, ensuring repeat business, encouraging word-of-mouth, and increasing sales.
How to Measure it
CSAT = Sum of All Satisfaction Scores / Number of Respondents
You can also calculate the percentage of customers who are highly satisfied (e.g. 4+/5) or dissatisfied (e.g. 2-/5):
CSAT % (Top-Tier) = Number of Top-Tier Scores / Total Responses
CSAT % (Bottom-Tier) = Number of Bottom-Tier Scores / Total Responses
Higher is better.
20. Churn Rate
Churn rate (CR), or Customer Churn Rate, measures the number of customers who discontinue their relationship with your company as a result of a project’s success (or lack thereof).
SaaS companies and others that work on a subscription model need to be particularly mindful of CR. Relating CR to individual projects may not always be easy, though.
However, it can be particularly useful for projects using agile methodology, where new features and updates are pushed out at a steady rate.
How to Measure it
CR = Number of Customers Lost / Total Number of Customers at Start of Period
For example, if the number of customers at the start of a three-month project is 200 and at the end we’ve lost 30 customers, the churn rate for that project is:
CR = 30 / 200 = 0.15 or 15%
The lower the number, the better.
Conclusion
Navigating the complexities of project management demands not only skill and dedication but also a clear understanding of one’s position at all times.
This is the power of Key Performance Indicators—they offer project managers a lens through which to view a project’s health, guiding them toward informed decisions and strategic improvements.
By embracing these 20 KPIs, you’re not just tracking numbers; you’re honing a pathway to success.
To track project performance, use a set of Key Performance Indicators (KPIs) that align with your project goals. These can include Planned Value and Actual Costs (AC), which help you monitor budget and schedule adherence. Additionally, metrics like Schedule Variance and Cost Variance give you insights into whether your project is on track.
How do you measure team productivity and efficiency?
Measuring team productivity and efficiency can be approached by monitoring KPIs such as Billable Utilization, which shows the percentage of time spent on billable work versus total available time. You can also look at Cycle Time for completing tasks and the On-Time Completion Percentage to evaluate how effectively the team meets deadlines.
How should you define KPIs in project management?
When defining KPIs in project management, start by ensuring they’re tied to the strategic goals of your project. Choose KPIs that are measurable, relevant, and time-bound, such as Stakeholder Satisfaction, Risk Identification Rate, and Cost Estimation Accuracy.
Christian holds a BSc in Psychology with an emphasis on organizational management and is the current Head of Operations for Eleven Media, where he oversees day-to-day business operations, manages a team of project and account managers, and otherwise greases the sticky wheels of company-wide collaboration. Prior to this, he managed operations for a hotel chain in the South of France while completing a Masters in History. When not geeking out over automations and data analysis, he can usually be found cycling and hiking around the French Riviera.
