Software Implementation Project Metrics

Software implementation refers to the process of integrating and adopting a software application into a workflow.

Selecting a business application for your business isn't an easy process. It starts with identifying the business need and then defining the goals and outcomes in a project charter that goes through rounds of internal discussions and approvals.

After defining the main picture, a team formation process starts to bring in the right individuals with the right skills. That team takes ownership of identifying and prioritizing the requirements of the needed business application. They also start identifying potential products and evaluating them. They may need help from vendors or IT partners, so they ask for proposals (RFP) and add a vendor evaluation process to select between vendors.

Some companies prefer to build a proof of value (POV) or a proof of concept (POC) by selecting a use case to test the vendor and the selected business application and measure the outcomes towards the original goals.

There are a ton of details in each step of the previous steps till you close the deal successfully with one of the vendors, IT partners, or professional services companies.

Once the deal is closed and the project is initiated by the professional services team, the vendor company assigns a professional services team to tackle the project with the customer.

Without digging into the details of project management methodologies and the nature of each project in respect of the market, industry, and business domain, this article is concerned with the implementation metrics.

You can’t manage what you don’t know. You don’t know what you don’t measure. So measuring is the foundation. Think about project metrics as measured answers to stakeholders’ questions like, “where do we stand? Were the project success criteria met? Do we need to follow a different path? And many other questions.

Using off-the-shelf metrics that are found in traditional project management books (PMBok) may not fit or may not be sufficient for every project.

You may need to use only one or more metrics of the following in the implementation projects, there is no standard way to define which metrics must be measured and which aren't it's all up to your company's management philosophy.

Benefits of Using Metrics

• Can be indicators of hitting targets, getting better, or getting worse.
• Early identification of issues
• Lead to informed decisions
• Improve future estimating
• Can improve customer satisfaction
• Help in resolving crises
• Allow project managers to identify potential risks

Characteristics of a Metric

A metric should have certain basic characteristics, For example, a metric should

• Have a need or a purpose
• Provide useful information
• Focus on a goal
• Be measured with reasonable accuracy
• Be an indicator of the true status of the project
• Support proactive management
• Be used in the assessment of the likelihood of success or failure
• Be accepted by the stakeholders as a tool for informed decision making

Metrics Categories?

You can categorize the metrics into 3 main categories

• Project Management Methodology metrics
• Scope-based metrics
• Business success-based metrics

Sample Metrics

• Schedule Variance: Actual Progress VS Expected Progress

Most project management tools can calculate this value automatically at any point in the project. Here is an example of simplified manual calculations:

Project Length: 6 Week

Calculation Point: End of week 2

Average of the overall actual progress = 40%

Percentage Planned = (2 / 6) * 100 = 33%

Schedule Variance =?40 - 33 = 7 (Positive, ahead of plan)        

The calculations can be more complex than that if the tasks’ costs differ then the actual costs and the planned costs can be calculated. In most implementations, the simplified calculation of task completion percentage can be sufficient.

• Resource utilization: Number of hours worked (or billed) vs number of hours booked

This metric can help identify over or underestimation issues, burnout early detector, requirements issues, identifying rework issues, average daily rates..etc

• Week counter vs total number of weeks

This metric can be shown on the Gantt chart or the roadmap of the project to give a glimpse to stakeholders who don’t need many details. Can also be good for the team to sense the overall position, it’s like a countdown to motivate them toward the finish line.

There are endless metrics that can be useful to detect different aspects of a waterfall project's success factors, but it’s important to consider the cost and the complexity of measurement against the gained value from measuring. Keep it simple, keep it smart.?

• Team Velocity

Some Scrum teams use this metric as a tool to measure the amount of work a team can deliver during a sprint. This metric is helpful when planning sprints and releases.

• Remaining Effort vs Planned Effort per sprint or release

This is usually visualized as a burndown chart. You can get many insights from these charts, detecting estimation issues, rework issues, “definition of done” issues, requirements issues, commitment issues, planning issues, workflow malfunctions …etc

• Kanban Metrics

Cycle time is the amount of time it takes for a unit of work to go through the team’s workflow from start to end. Low cycle times mean your team is working efficiently, high cycle times indicate that something is stalling your process. Keeping your cycle times down keeps your lead times down, and leads to high customer satisfaction.

Lead time is the period between a new task’s appearance in the workflow and its final state. This means that Lead time = Waiting time + Cycle time

Throughput is a capacity metric that measures the total amount of work delivered in a certain period. Throughput only measures completed work items.

Work in Progress (WIP) is the limit of the number of work items that can be tackled in parallel. It depends on the team size and the type of work you do for the customers. If the implementation scope is to build a certain number of dashboards, build data marts, etc, this will give you visibility on the team’s efficiency. Increasing this limit will impact the Cycle time and lead time.?It’s good to know what are your limits that guarantee fast-paced deliverables.

• Sample Business Success Metrics

Cost reduction due to manual workflow elimination. This can be calculated by multiplying the time that the user usually spends performing a similar old task but on the new business application by the average hourly rate of the customer team members.

Record to Report (R2R) is the time from saving a record on customer systems to the moment of showing that record in reports to the business teams on the new business application.

Customer Users Adoption is the number of active users who are using the new business application daily.

Return on investment (ROI) calculating actual ROI to the customer is a daunting task as you will not be able to access the required measurement data on the customer side. However, making simple ROI calculations will help you envision the added value to the customer.

ROI = ((Final value of Investment - Initial cost)/Initial cost of investment)*100

Final value of investment = (Time Saved * average hourly rate of customer resources) + Productivity Gain on the customer side + other Cost-cutting items

Initial cost of investment = Software license cost + Cost of services + Implementation labor        

It’s always recommended to have a metrics library for each type of implementation per domain, region, service type, project duration, and customer management maturity level.?And Don't overwhelm yourself, your team, or your stakeholders with unnecessary metrics or complex measurements.

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