How are you currently measuring project success?

Traditionally, many of us have been using financials, such as budget, as the leading indicator to measure performance; after-all, the ultimate goal is to make money and be profitable. However, relying solely on this metric is not advised as there are a number of other essential metrics that you can use to help you determine whether a project is on track, with some of them even providing you with actionable insights into what needs to be done to get there.

Before we get into the specific KPIs you should be measuring, here is a quick refresh on what KPIs actually are. For those of you who aren’t familiar with the term KPI, it stands for Key Performance Indicator.

As the name suggests, construction KPIs are the critical (key) indicators of progress towards an intended result. KPIs are measurable, and can easily be compared and tracked, allowing you to evaluate whether you’re meeting your objectives or not.

Relying on budget as a leading indicator for project performance is very similar to calculating the calories in a lasagna to assess how healthy it is AFTER it has been baked. It might be helpful knowing this, as it can let you know how much of it you can eat to stay within your daily caloric intake, but there is nothing you can do about it now to change it in the event it doesn’t fit within your macronutrient requirements. In other words, it’s too late to change the outcome using this metric as your leading indicator.

On the other hand, if you were able to measure and adjust the ingredients of the lasagna as you were baking it, the results would lead to a more desirable outcome which fulfills your need for a healthy lasagna (if healthy dining is something you care about).

As you can see above, pure financials are a lagging indicator of performance, meaning they don’t provide you with actionable insights that can help prevent unwanted results. So why then are they often the primary focus when it comes to measuring success?

Simply put, it doesn’t make sense to solely rely on that. Other key measurements need to be accounted for in order to not only track construction progress and performance, but also increase profitability.

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