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Project Management Metrics: What to Track and Why

Project Management Guide

Project Management Metrics: What to Track and Why

By Steve Pogue

Tracking and focusing on the right project management metrics can be a game-changer in your project management. Tracking the wrong metrics can distract you and your team from the things that truly matter.

It’s crucial to track only the things that truly make a difference to the success of your project

This article will help you understand which elements of a project are make-or-break, and why. It will also illustrate how tracking and communicating these key elements help ensure project success. 

The Triple Constraint

In project management, the Iron Triangle is the Triple Constraint. The three sides of a triangle are competing constraints. These constraints are:

  1. Time
  2. Cost
  3. Scope
project management metrics

Tracking these three elements is critical for the success of a project, as the three are interrelated. Any pressure on one side requires at least one of the other two to compensate. For example, if the timeline needs to change by two weeks, it will cause a change in either cost, scope, or both. 

1. Time

By its very definition, a project is temporary and must have an end date. Progress towards this end date must be monitored and managed to ensure you’re still on track to meet your deadline. To do this, a project schedule must be created, regularly updated, and controlled throughout the project. 

A lack of details like these in your project schedule makes it difficult to track progress and identify risks and issues. On the other hand, too much detail can result in an unmanageable schedule that takes hours to update. 

In fact, the Project Management Institute (PMI), lists ‘Inappropriate Level of Detail,’ as one of the top ten scheduling mistakes that project managers make. 

So how do you create a schedule that tracks at an appropriate level of detail?

Start by developing the Work Breakdown Structure (WBS) of the project. This means you take the project and break it down into smaller chunks. 

For instance, your project may be to construct a house. The project can be broken down into the foundation of the house, the main structure of the house (framing, roof, etc.), and the internal components of the house (drywall, electricity, etc.)

Each of those chunks would be broken down further and further until you get to the lowest reasonable level of detail. The lowest reasonable level of detail usually differs from project to project, so it can be helpful to have a set of basic rules to follow when determining it.

Here are some guidelines for which level of detail is reasonable:

  1. It consists of one clear deliverable or milestone.
  2. The work will be performed by one person or one ‘role’. 
  3. It can be given one defined period for completion.
  4. An estimated cost can be assigned to it. 

Consider this example: Hook up all the power outlets in the house. 

  1. One clear deliverable
  2. Done by a single type of person: electricians
  3. Defined timeline. It’s not something that will start today, then have to stop in two days and cannot start again until something else is completed. 
  4. It’s possible to assign a cost to the task based on estimated hours and materials required. 

Why not have hooking up each room as a separate activity?

As a general rule of thumb, the lowest level in a schedule should be between 20 and 80 hours of work. So, if each room only takes 3–4 hours, it would be overkill to include that level of detail in your schedule. 

2. Cost

Every project needs a budget, and it’s crucial to track costs against this budget to ensure you don’t run out of money before the project is completed. 

A project’s cost should be monitored at both the overall project level and at the detailed level. The project’s progress also needs to be taken into account. 

For example, let’s say your project budget is $50,000 and the project length is six months. 

You’re three months in, and you spent $25,000. Are you on track? 

What if the project is only actually 40% complete? 

Or, what if the final phase of your project, which doesn’t start until month five, requires ¼ of your total budget? 

If you don’t track at the lowest level of detail, you may miss problems until it’s too late. 

However, it can be difficult to track labor down to the lowest level of detail when tracking by dollars spent. There are two reasons for this:

  1. Converting hours to dollars may require access to sensitive payroll information.
  2. It adds complexity to the project schedule and tracking system, since two people with the same job title could make different wages. 

To overcome these difficulties, labor is often tracked in hours rather than dollars. Many project management tools offer time tracking to help monitor budget.

3. Scope

The third side of the triangle is project scope. The scope encompasses not only what must be delivered as part of the project, but also the quality of those deliverables. 

Scope tracking is critical to managing any change requests to the original scope so that you and the end customer are both aligned as to what the scope of the project is. Effective scope tracking also helps avoid Scope creep, which is when the scope of your project slowly grows little by little until it has a negative impact on project performance

Some common examples of tools for tracking scope are:

  • Requirements documents
  • Design documents
  • Change requests
  • Verification or sign-off criteria 
  • Using a Gantt Chart with Critical Path to identify timeline changes

If we go back to the house example, the scope of the project may be a two-level, three-bedroom, 2,000-square-foot home. The scope may also include other factors such as energy efficiency levels, grade of materials used, etc.  

The blueprints of the house, and inspections and walkthroughs by the client, are examples of tools used for tracking and verifying scope. 

Other Project Management Components to Track

Teams should track three other factors for successful project management:

  1. Resources
  2. Risks
  3. Project changes

1. Resources 

Ensuring that resources are assigned to the tasks in your schedule and that they are available when you need them is a critical component of project management. 

Without proper resource allocation and management, a project could come to a screeching halt. 

For example: what happens if you need the structure of the house inspected before you begin drywalling, but you forgot to book the inspector? 

Maybe, when building the initial schedule, you knew you needed an inspector, so you assigned the role of ‘inspector’ to the task in the schedule. But, you forgot to find an individual inspector, and to replace the generic role with that person’s name. So, when the time comes for an inspection, you don’t have an actual individual on site and ready to do the job. 

Tracking resources means ensuring that named resources have been assigned for all upcoming tasks and that those resources are both available and aware that they’ve been assigned. 

2. Risks and Issues

During the planning stage of a project, risks should be identified, and a risk management plan should be created. This allows you to identify what could happen, and what your Plan B is, if it does. 

However, without tracking risks, you won’t know when to implement your mitigation plan or Plan B. Plus, you won’t capture new risks that arise as the project progresses. It’s important to review your identified risks and mitigation plans regularly to make sure you’re prepared for when something goes wrong. 

When a risk occurs, it’s referred to as an issue, which also needs to be tracked. This is so you can monitor and communicate its impact and what is being done about it. 

If a tropical storm blows in and delays project construction by a week, it’s an issue. You’ll need to track the storm’s progress, any damage it causes to the project, and what you’re doing to resolve the issue. 

For example, you may plan for the team to work overtime for two weeks after the storm ends to catch up. You will need to track that everyone is available, that the extra cost is within the project’s cost constraints, and that the schedule is catching back up. 

3. Project Changes

Change is the final component to track. These could be changes to the scope, schedule, cost, or resources. 

There should be a defined process for proposing, reviewing and approving changes on a project. Often this is encompassed in a change management plan and tracked with change request forms and a change request log. 

Change tracking allows you to ensure all changes are documented, assessed for potential impacts, reviewed, and approved by the relevant experts and project stakeholders. This tracking and control process ensures that impacts of change are not missed, and that all changes are accepted by the customer and project stakeholders before they occur.

Summary: Project Management Metrics Tracking

The six primary things to track and communicate on a project are:

  1. Time
  2. Cost
  3. Scope
  4. Resources
  5. Risks and issues
  6. Changes

Tracking and reporting on these six things allow you to:

  • Keep track of progress towards deliverables and milestones.
  • Manage costs and identify budget issues early.
  • Have well-defined project scope and deliverables.
  • Ensure resources are available and ready to complete tasks.
  • Identify risks and implement mitigation plans quickly. 
  • Deliver end products that meet customer expectations. 

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Steve Pogue is the Marketing Operations Manager at Workzone. He writes about project management tips and the buying process. When not at Workzone, you can find him playing vintage base ball or relaxing with his family at home.