In an organization, there are multiple projects that are going on simultaneously. Each project is unique and handled differently by different teams. While the goal of every person involved is to make the project a success, there is a lot that goes into ensuring it. From keeping it afloat in the initial stages to finding loopholes and whatnot. While we know that these projects are the backbone of any organization, it is vital to understand the importance of measuring project success and how. This blog will take you through the most common and widely used methods of measuring project success and other nuances around them.

Importance of measuring project success

As much as starting or having a project is important for any organization, it is necessary for them to measure the chances of success after every interval. This helps in ensuring that the ultimate goal set for the project is still attainable and within manageable boundaries. It is about making sure the steps taken are traceable and allocating tasks to each member of the team according to their strengths. This helps to ensure that they are following the set path to the best of their abilities.

A project’s success is not only dependent on its financial resources but also on how well it is executed from conception to implementation. A good concoction of strategic planning, a methodical approach, best practices, effective communication, and careful management of risks strengthens the foundation of any project, thus making sure that it is on its way to success. Now that we understand the importance of measuring project success, let’s discuss the two most commonly used methods for this. Key performance indicators (KPIs) and Key risk indicators (KRIs) are universally adopted methods for measuring any risks and allocating responsibilities, among other things.

Understanding the terms KPIs and KRIs

Key Performance Indicators (KPIs) come into play when an organization or a team has decided on its strategic goals for a project. KPIs are monitoring and decision-making tools that are helpful in handling the main performance issues while working on a project. By giving a clear picture of overall current performance and indicating whether or not the project is on track, correctly designed KPIs will act as crucial navigational tools. They are like the building blocks for the successful completion of any project.

Apart from carefully making a step-by-step plan to achieve success in any project through KPIs, it is of great importance to have a risk management plan as well in case of contingencies. Key Risk Indicators (KRIs) are one such widely used metric risk indicator. KRIs are used by organizations to evaluate the degree of risk exposure, or how high the chances are of any risks occurring while working on a certain project. These indicators allow the team to identify any risks in advance by closely monitoring the project. In the case of any probable risk, the chances of it happening can be averted in time. And in the worst case, it can be handled from the beginning to reduce the effects on the project.

How do KPIs and KRIs help in enhancing performance?

– Measuring methods: KPIs help in measuring non-financial behaviors, and KRIs help in measuring both financial and non-financial behaviors.

– Coverage: Adopting both methods allows you to closely follow the performance and risks of a project at the same time, ensuring more balance, security, and higher success chances.

– Regular updates: KPIs are measured more frequently on a daily and weekly basis, while KRIs are measured monthly or quarterly. This gives a great insight into the progress of the ongoing project.

– Allocated responsibilities: The responsibilities to handle the task at hand or in case of any obstacle lie with different members based on seniority. The team leader or members are in charge of KPIs, while the CEO or senior management team is responsible for KRIs.

– Credible information: KPIs and KRIs help in generating credible and high-quality information, which helps in strengthening the foundation of a project as it progresses.

– Future support: The data collected gives better cognition to the people and organization involved in a project, preparing them for future risk and performance management.

 

Conclusion

To summarize, while the success of a project is dependent on the team, the methods proposed are also important. It is necessary to measure a project’s success with the right tools that can provide close, if not exact, data to base decisions on. Unless we have any solid data to prove our actions, everything that we plan is only verbal. With methods like KPIs and KRIs, it becomes easier to measure the success of any project. They serve as early warning indicators. By analyzing risks and their potential effects on business performance, the team responsible or the organization can create detection systems that enable them to monitor, manage, and mitigate significant risks. Every project will have tailored KPIs and KRIs, so it is necessary to have them as per the project’s end goal. Regular updates and checks in between whether they are working as required for the current project or not will give a clearer idea about the chances of success.