Key Performance Indicator (KPI) is a quantifiable performance measurement applied to determine success factors and estimate progress towards the achievement of project objectives. Managing engineering company effectively requires good decision-making which is based on good management of information. To increase profitability the company needs to understand and monitor key factors of the processes. These factors have a major impact on the performance of the engineering company. Task performance is determined by a range of factors. The main of them are project costs and budget.
Budget and Costs compliance
Successful practice of project cost management demonstrates that measuring specific costs within the project can lead to significant improvements in quality, productivity, waste, and customer service. It also demonstrates that accountability is an important component in effective project measurement system and that cost measures can play a significant role in managing funds. When managing costs of the project, engineering company should create a set of indicators that covers all project spending.
|
|
In our example, we have united all cost measures into several groups like follows:
- Management costs
- Personnel costs
- Indirect costs
|
|
Each engineering company can elaborate own specific indicators to measure project costs. However, these groups describe costs of the project in general. By using custom field feature VIP Task Manager allows to add each of the group in the company database and calculate total costs of the project. For example, the project manager can calculate total costs for the projects related to the Client 1. The task group "Client 1" has three projects: "Project 1", "Project 2" and "Project 3". By creating custom fields "Management costs", "Personnel costs", "Indirect costs" and "Total costs", the manager can calculate and sup up total costs per project. The system can sum up costs per project as well as output total costs value for all projects of the client.
|
Better cost management means better budget allocations and reduced costs per item of the project plan. To measure efficiency of project spending and budget allocation, VIP Task Manager offers custom field feature to create key performance indicator. For example, manager of engineering company can create custom field to compare budget to project costs and find out weather allocated budget resources cover project costs. The custom field "Budget/Costs" is a key performance indicator calculated as division between budget and costs. If the indicator shows value that more than 1, actual costs exceeds planned budget. As budget does not cover project costs, the manager should revise project cost management. |
|
| |
| | |
Play Demo
Try It FREE
