Projects should be measured on five specific dimensions: efficiency, customer, business-now, business-future, and team success.
From these dimensions, business measures, customer measures, and process measures should form the basis for creating various metrics to measure the project manager. I say “various metrics,” because there simply is no single set of measures that universally applies to all industries and all environments in which companies compete.
We understand success means different things to different people, in different settings, and at different times. To create meaningful measures to evaluate a project manager’s success, consider first the position’s connection to organizational success. From an organizational perspective, success is multidimensional as well. A healthy organization will have a mix of immediate goals, mid-term goals, and long-term goals. These goals and their underlying success metrics should be the origination point for evaluating a project manager’s success.
An organization’s immediate goals are efficiency related, focused on getting the job done and on operational excellence. Immediate goals deal with the project’s constraints and evaluate from a quantitative perspective, whether the project delivery was within required scope, budget and schedule.
Mid-term goals are completion and satisfaction related. This dimension relates to the customer and examines success not only from an efficiency standpoint (i.e. milestones met), but also adds an effectiveness perspective; for example, success of the end-result. Did we solve the customer’s problem and meet functional performance and technical specifications? Did we achieve through the project the benefits they hoped to achieve? Is the customer satisfied and are they using the product/service delivered?
While mid-term goals focus on the customer (important to any organization), business-near and business-future dimensions examine corporate (or enterprise) success and strive to evaluate the efficiency and effectiveness of a project, specifically, the short- and long-range impact to the performing organization.
The business-near dimension (a long-term goal relatively speaking), examines short-term business results to measure commercial success using return on investment, net present value, internal rate of return, payback, and contribution to free cash flow.
Business-future evaluates the longer-term benefits delivered that prepare the organization for the future. These are projects initiated for wider reasons than just immediate profits. For example, beyond ROI are such things as visibility, publicity, corporate reputation, and customer value. This dimension also scrutinizes success to analyze and determine if the organization is in a better position to insure its survivability and competitiveness well into the future. Examined is a whole host of factors, which may include (but are not limited to), have we opened new markets, developed new or not yet existent technology, increased capabilities, gained technological superiority, increased barriers to entry for competitors, or developed a new generation of products to exploit?
The team dimension seeks to measure (from an efficiency perspective) the unique micro-culture surrounding the team. Qualitative measures gathered from within this dimension are important to organizations, as teamwork effectiveness has a clear and visible connection to bottom-line results.
Many of these soft measures provide useful insights into the leadership qualities of the project manager and need to be included when measuring the project manager’s success.
Such measures often point directly to a project manager’s emotional intelligence, values, character traits, leadership qualities and the ability to use personal influence (soft skills) to lead people. The sum of these skillfully applied leadership attributes can draw forth the full team potential and create a fun and spirited work environment, while producing change and movement that get results.
The Team Dimension is about Leadership. Don’t forget the soft measures. Business is about people and relationships …end of story; it’s how business gets done. Take care of your people; success (and profits) will follow.
Measures useful in gauging teamwork effective-ness may include discussion or metrics pertaining to information sharing, involvement of the customer, excitement, conflict management, emotional energy, collaboration, project team satisfaction, and a host of other soft measures.
Achievement of these goals, often structured and achieved through projects, will if executed correctly, create economic value and competitive advantage; these being (primarily) the sole reason a for-profit organization exists. The individual carrying great responsibility for the attainment of these collective goals is none other than the project manager.
The ability of the project manager to deliver on all these levels should form the basis from which his or her success is measured. His or her actions, given the right setting and/or right circumstances can make or break a company, while skillful execution can bring great success to an organization.
Obviously, a project manager shoulders tremendous responsibility. The best project manager(s), as measured against these critical success dimensions, should be the one(s) that rise to the top to lead the most important projects.
A project manager (acting in a principal-agent capacity) is charged with project execution accountability, but has an even higher fiduciary responsibility to create economic value and competitive advantage. In a perfect world, these dimensions determine how a project manager’s success is measured.
If all the above is important to the employer, as they would readily argue they are, why then would a project manager not be measured or held accountable on the totality of efficiency, customer, business-now, business-future, and team-related metrics? Often easier said than achieved.