1. Project Management Metrics -- Why, What, and When Kerinia Cusick Director, ESI International

2. © ESI International 2 Pop Quiz!  Metrics are free  What gets measured gets done  A 10% out of budget project is in trouble  The primary goal of metrics is reporting progress TrueFalse

3. © ESI International 3 Pop Quiz!  Project metrics should be linked with organizational goals  Metrics do not require an owner or review plan  Metrics are excellent tool for pointing out under performing team members TrueFalse

4. © ESI International 4 Types of Project Metrics  Primary Metrics  Always needed  Cost  Schedule  Scope  Risk  Decision Making  Secondary Metrics  Used when anticipate may be a problem area  Integration  Quality  Human Resource  Communications  Procurement Advanced

5. © ESI International 5 Cost Metrics  Cost Metrics focus on project performance to the budget  Examples of Project Monitoring Cost Metrics:  Actual against Plan (budget/actual)  Earned Value Cost Metrics  Examples of Project Selection Cost Metrics:  ROI (Return on Investment)  ROA (Return on Assets)  NPV (Net Present Value)  IRR (Internal Rate of Return)

6. © ESI International 6 Project Monitoring Cost Metrics Time $ People Budget/Estimate/Plan Actual General Guidelines: 0 - 10% variation -> caution 10 - 20% variation -> warning >20% variation -> critical

7. © ESI International 7 A Word About Budget and Actual Time $ New baseline Baseline (a.k.a. budget) Actual costs Rebaseline (new budget) CPI (Cost Performance Index) = Budget/Actual CPI Baseline = bad (<1) CPI Rebaseline = good (>1) Now

8. © ESI International 8 Your Performance Is Only As Good As Your Estimate….  Methods for estimating  Bottom-Up  Expert Judgment  Historical Data  Modeling  Use methods in combination to validate important estimates

9. © ESI International 9 Time Metrics  Time Metrics focus on project performance to the schedule  Examples of Time Metrics:  Earned Value Schedule Metrics  Status of critical path  Milestones  Deliverables  Ahead/Delay  Baseline Changes  Milestone Rate Chart

10. © ESI International 10 Milestone Rate Chart Time % Complete Plan Actual Design Code Unit Test Integration Divide into Project Lifecycle Phase or roll up into a composite

11. © ESI International 11 Being Driven to be Late?  Stop the clock!  Measure & Report: time spent working versus time spent waiting for data

12. © ESI International 12 Scope Metrics - Examples  Examples of Product Scope Metrics  Met customer objectives and requirements  Product quality measures  Product requirements changes  Product complexity  Reuse of existing product and processes designs

13. © ESI International 13 Risk Metrics - Primary Options Characterize levels of risk by consequence and probability -> Determine # of high, medium, low risks Quantify and assess risk mitigation estimate (at each product phase gate) 1 2

14. © ESI International 14 Risk Matrix Impact Probability VL LMH VH VL LMH VH Low Medium High Impact Guidelines VH = 5% of project costs H = 3% M = 2% L = 1% VL = 0.5% Simple Risk Metric = Number of high, medium, low risks

15. © ESI International 15 The Key to Scope & Risk Metrics Measured in….

16. © ESI International 16 Decision Making  Type:  Consensus, autocratic, democratic, delegated  Speed:  How rapidly decisions being made or passed up to management?  Time to close action items on register, # of overdue action items, total weeks overdue  Decision matrix

17. © ESI International 17 Decision Management  Rolling Action Item Metrics:  Weekly ratio of open/closed action items  Must maintain weekly list of action items with number of items closed and number of items added  1.0 = project is staying the same  <1.0 = project is converging  >1.0 = plan is inadequate  Caution: keep project phase in mind when setting objective for ratio (i.e. planning phase >1.0 less critical than implementation)

18. © ESI International 18 Measurement Intervals  Weekly  Basic progress indicators - $spent, milestones completed, hours worked, etc  Monthly  Key indicators that don’t change frequently enough to measure weekly  At Phase Reviews  Roll up of weekly & monthly and new “event based metrics”  Simple metrics: time, milestones completed, RYG indicators  Progress toward fulfilling your strategic goals  At Completion  Fulfillment of strategic goals

19. © ESI International 19 Dashboard Report - Software Project Manager’s Network Sample Source: http://www.spmn.com

20. © ESI International 20 If You Are Ready to Become Even Smarter….  Balanced Scorecard, Nolan & Kaplan  ESI Master’s Certificate in Project Management (http://www.esi-intl.com)  Practical Software Metrics, Grady  ProjectPORTFOLIO: ESI Portfolio Management Process  Software Project Managers Network - Dashboard (http://www.spmn.com)  Visual Explanations, Tufte

21. © ESI International 21 Questions?  Feel free to call or email:  Kcusick@esi-intl.com Kcusick@esi-intl.com  Office: 818-596-2344