Using KPIs to measure a project team's effectiveness
The types of KPIs vary, depending on critical success factors (CSF) like industry, product or service, and stakeholder business and operational strategies. Nonetheless, KPIs must be clearly identified, achievable, and quantifiable in an appropriate form and within specified parameters in order to be completely suitable for a given project. For example, if one CSF of a new software business is to develop a Web-based portal that will garner a specified number of new customers that sign up for a monthly subscription service, then a relevant KPI could be quantitative in nature — something like number of new subscribers.
When deciding on what KPIs to use, you should clearly and accurately define critical success factors first, and then identify KPIs that are most accurately and directly tied to the CSFs. Again, both the CSFs and KPIs must be clearly defined and agreed-upon by stakeholders and they should be ranked in order of importance to the overall business strategy and goals.
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Here are some examples of the types of project management KPIs that apply to team performance and strength:
KPIs measuring team performance would most likely be qualitative in nature. But a process or quantitative metric could also be used to evaluate teams — depending on the nature of the project, product, service or industry — since team and individual activities may involve the utilization of specific processes or quantifiable activities to accomplish goals.
Here are some steps that will help you identify the KPIs that are appropriate for your project.
When trying to determine KPIs to measure your project team’s performance, strength and overall synergy, think about your expectations and the factors that will determine success in relation to the specific project objectives and overall business objectives. It's important to know as precisely as possible what you’re looking for before you can decide how to accurately measure it. Essentially, you need to determine what you want the team to be. Here are some steps that will help you draw up your “to be” list:
Compiling your “to be” list should help greatly in determining the KPIs that would most effectively and accurately measure team performance and strength. As mentioned above, regardless of the nature of the KPIs, remember that they must be not only clearly identified but also achievable and quantifiable in an appropriate form and within specified parameters.
To further solidify and flesh out your requirements for your team and its members, consider the following 10 project management knowledge areas: scope, time, cost, quality, human resources, communication, risk, procurement and stakeholder management. Then try to identify exactly how your team will manage or respond to each of them. This will help ensure that you have taken a holistic view of the project and have considered all of the factors that could come into play before choosing the criteria that will determine your KPIs.
As part of this exercise, remember that team-based KPIs should attempt to capture least some of the following (as applicable):
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In the book Performance Indicators (KPI): The 75 Measures Every Manager Needs to Know, Bernard Marr, a leading global authority on organizational performance and business, outlines 12 KPIs specific to measuring employee performance. Here are seven of those KPIs that, while employee-oriented, may be adapted to measure team performance.
Team-based KPIs enable businesses to measure project team performance to ensure that team members are optimally working together to achieve project objectives in ways that can be directly tied back to companywide goals and strategy. Remember, all KPIs must be appropriately identified, reachable and realistically measurable, as well as clearly communicated, documented and agreed upon.