The last couple of posts have covered the importance of project metrics to measure outcomes and how to define a process to capture and manage. This is all very important. However, in order for the metrics to have value, it is important to be able to define the data points that will be used. If the wrong data points are selected then the value of the metric will be diminished or even be worthless. Then you will have the over-head of collecting and reporting with no value being returned.
Metrics are different
Unlike counting budget and headcount, it is unlikely that the metrics required to demonstrate project outcomes will be the same. Yes you may have some relating to budget saves, increased profits, etc (common currency numbers) or headcount reduction (common FTE number). However, the reality is the project will also have governance forums established, processes implemented, etc. Variations by business, function, location, etc. The permutations are endless and so is capturing the data.
What this means is that the providers of the data may find it hard to define the metrics and data points. As it will not be possible to provide specific instructions on metric types, the PMO must provide a framework to help (if not you will not get the metrics you require).
What you need for meaningful metrics
Firstly you need to define the metric and the rationale why it makes sense to capture and track. You then need the following data points.
1. Current Value
This very simply is the current value of the metric you wish to track, making it clear the unit of measure.
2. Total Value
This can also be thought of as the total universe, 100% amount, etc for the value. For example, if you had to implement a governance structure into 5 regions, the Total Value would be equal to 5.
3. Target Value
This is the minimum value that the project must attain to be successful. For example, in the case of the regional governance structure, the target may well be 5 (or 100%). However, other metrics not require 100% as the benefit can be achieved with less i.e. 80%, as the cost to complete the remaining 20% is not worth the time and investment.
This value is very important as it reduces the risk of wasting time completing something that is not required. It also means that stakeholders have a frame of reference. 6o% out of 100% looks a lot worse than 60% with a target of 80%.
4. Previous Value
This is required to measure progress since last reporting period. Ideally there should be an upward trend. If the value is same as Current Value or, even worse, takes a step backwards, this will be a concern to stakeholders.
Some metrics may be meaningless unless there is a time element. Taking the governance structure example again. The metric may show that 3 out of 5 is complete. Without knowing the target for the period, how can you interpret if this is good or bad i.e. if it should have been 2 very good, if 3 on target, if 4 behind plan.
Metrics by their nature will be different. Keeping the above rules in mind will help you to guide the projects to define metrics that will add value and be able to demonstrate progress.