A Key Performance Indicator (KPI) is a quantifiable metric used to assess project success, performance, and progress. KPIs help organizations measure whether their goals and objectives are being met effectively.
There are different types of KPIs based on project requirements:
- Efficiency KPIs: Track resource utilization and productivity (e.g., “Cycle Time” for task completion).
- Financial KPIs: Measure cost performance (e.g., “Budget Variance”).
- Customer Satisfaction KPIs: Assess end-user feedback (e.g., “Net Promoter Score”).
- Quality KPIs: Evaluate defect rates and compliance (e.g., “Defect Density” in software development).
For example, in an Agile project, KPIs such as “Velocity” (measuring completed story points per sprint) or “Lead Time” (time taken from task initiation to completion) provide insights into team productivity and workflow efficiency. Organizations use KPIs to drive data-backed decisions, optimize performance, and ensure project goals are met within scope, budget, and timeline constraints.
