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Which Metrics Make the Most Sense?

Which Metrics Make the Most Sense?
Mature project management offices (PMOs) are shifting away from the iron triangle to measure the true success of their project.  

Key Takeaways 

• The most mature PMOs are relying on metrics beyond time, budget and scope to determine whether their project was a success. 
• To determine which metrics will best help your project’s story, it helps to collaborate with senior leadership and key internal and external stakeholders. 

PMI Picks offers the following insights for all project managers to consider when it comes to metrics: 

For many PMOs, success has traditionally been defined by the tried-and-true iron triangle: Was the project completed on time, on budget and within scope? But among the best PMOs in the world, a shift is happening in which metrics matter. 

Instead of relying on time, budget and scope, the Top 10 Percent — a group of 230 PMOs that make up the top 10% of organizations according to the PMI PMO maturity index — are relying on a wider variety of measures and higher frequency of measurement to gauge the success of their work. That’s because when the success story of a project is limited to time, scope and budget, there is no real evidence being shared about how the real world was impacted by the work being done and the people or business it was being done for. 

Even still, according to the PMI report Measuring What Matters, the majority of organizations have an average of 7.1 metrics in place for every project, with typically four that are linked to the iron triangle. That leaves only three metrics that measure the story of the project’s success. 

To truly measure the results of a project, project leaders need to evolve the metrics they have in place to go beyond the usual suspects. These metrics may include customer satisfaction, cultural shifts — such as the willingness of employees to adapt a new process — or operational efficiencies. 

To decide which metrics make the most sense for your project, it is important to involve senior leadership. According to PMI research, however, only 39% engage the C-suite. Measures being developed without collaboration between the PMO and senior leadership risk the development of metrics that fail to align to the organization’s strategic vision. 

In addition to leadership, the Top 10 Percent organizations further refine measurement by involving a greater variety of stakeholders, including customers, consultants and external stakeholders, to ensure metrics focus on the outcomes that really matter. 

Once key metrics have been identified, these measures should be actively reviewed by the right people. This should be a purposeful, collaborative reflection on what the measures are saying to tell the story of project impact in the best way and inform future projects. This reflection should then become part of daily team meetings, project reviews and part of monitoring PMO performance. 

Connecting Projects to Value

Connecting Projects to Value 
By understanding the “why” behind a project, project managers can ensure their team is focused on the right things. 

Key Takeaways 

• Projects exist to deliver the right value. 
• Projects are aligned with a portfolio that is aligned with goals and objectives that must be achieved.
• Project managers must consider their projects’ contributions to the required value, not just the performance against the triple constraint. 
   

Why is your project being undertaken? Why that solution, why now and why in this way? Why isn’t it something more significant? Or smaller? Or completely different? 

It’s not enough to say it’s because that’s what the sponsor wanted and approved. As a project manager, you must understand why your projects are being delivered and how they benefit the organization. Of course, you’re not the only person accountable for that — the sponsor and customer are keys — but you control the project on a day-to-day basis and must ensure you and your team are focused on the right things. 

By understanding the answers to these questions, you will be able to ensure that: 

Your project delivers the right kind of value. 

If the company wants to increase revenue, focusing on projects that reduce costs is a mistake. That’s where strategies come in. Regularly, often annually, leadership reviews and updates their strategic priorities — what is it that they want to achieve? Goals and objectives drive the value projects need to succeed. 

These goals and objectives form the framework for an organization’s portfolio or the collective set of investments that must be delivered to achieve organizational strategy. There may also be portfolios at a department level to achieve the goals and objectives of that department and maybe even product or service portfolios for different business functions. 

Historically, portfolios contained programs and projects, but today the types of investments are becoming more diverse. For example, you may have heard of projects to products — a concept where software development initiatives are structured as semi-permanent products without a defined end date. If those products deliver the relevant value, they’ll continue to be funded by the portfolio. 

There are also other emerging approaches to funding, such as capability-based investment, where funds are tied directly to achieving a business capability. But regardless of what they’re called, all investments are expected to deliver value contributing to one or more goals and objectives. 

Your project is aligned with goals and objectives. 

The organization won’t view the project as a success if it is on time, on scope and on schedule but doesn’t deliver the revenue, cost saving, risk reduction or whatever other value they expect. 

You and your team need to constantly ask, “are we delivering the best value we can” in terms of the expected contribution to the goals and objectives. Those conversations should include your key stakeholders, particularly the sponsor and customer. Those stakeholders will expect you to be looking for changes that can be made to improve value. They will be looking to you to discuss the business value that can be achieved rather than the triple constraint. 

This is especially critical today when things are moving so quickly. If you deliver a product based on the scope defined at the start of the project, you may find that those features are no longer what customers are looking for. No matter how good the solution is, if it’s viewed as obsolete by the time it is launched, it won’t deliver value.