7 types of construction KPIs you need for effective construction management

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Key performance indicators for a construction project manager are a pathway to achieve operative finesse across job site tasks and processes - Linarc outlines the essential construction KPIs

Project management KPIs are specific measurement tools indicating how well teams achieve particular goals. They reflect the targets of a project management team and solidify the tasks and processes at the construction jobsite. Key Performance Indicators (KPIs) can change the dynamics of a project, let’s explore.

KPIs for Collaborative Construction Management

To create practical and useful KPIs for Project Management, consider these factors:

  • KPIs must be clear and meaningful
  • Choose the essential indicators relevant to the project 
  • All parties must align with the objectives
  • Measure the KPIs regularly
  • KPIs must be realistic and cost-effective 
  • These should aim for the project's success
  • Must be agreed upon before the project begins

Construction KPIs types

1. Schedule

Schedule KPI reflects your schedule compliance and the overall efficiency of the scheduling process. Here, effective real-time communication improves the efficiency of workflows and helps reduce costs. It also ensures that projects proceed smoothly without interruption. Managers can alert jobsite personnel of upcoming changes to the schedule or find alternative suppliers or divert another truck with the suitable materials. 

You can determine whether your planning or scheduling system is performing optimally by tracking the work completed, started, and remaining. If KPI metrics consistently show low compliance across several weeks, it is time to investigate why. 

2. Cost

Cost management is the process of monitoring the cash flow in a project and identifying potential issues. A simple way to do this is using a Cost key performance indicator. Cost KPI help determine the financial stability of your program, allowing management to view cost predictability indicators like variance, cost of change orders, and project leader change orders. Moreover, cost KPI can help predict future costs by comparing how long tasks take and how much they cost. 

3. Quality

The quality of the construction is an important metric to determine whether the company can deliver the project within budget and on time. Quality metrics will help ensure that the project starts on the right foot and that any necessary changes, later, can be minimized. The cost of dealing with these changes can be substantial, prioritizing quality an essential part of a successful project.

Quality construction KPIs can consider the number of issues reported in quality checklist, punch list items, number of total site inspections, number of passed site inspections and inspection failures.

construction KPIs quality

4. Safety

Safety practices play a critical role at the jobsite, which is why it's essential to take a proactive approach when it comes to worker safety. Having proper safety KPIs can help you better understand how the business performs regarding safety and other KPIs related to profitability and productivity. To ensure that your construction site is safe, you must include KPIs pertaining to safety management, such as type, severity and frequency rate of injuries, its impact on the schedule; and staff training and safety huddles.

5. Waste

This KPI is essential for measuring a company's purchasing activity and inventory. As a crucial predictive measure of inventory use, the construction KPI can help compare purchasing activity and identify instances of wasted inventory. Measuring this KPI is vital as unused inventory can be a significant drain on the company or a project. 

KPIs such as waste generation rate, construction waste management, labour downtime, and equipment downtime should be compared to determine how inventory has been used throughout the project's life.

6. Sustainability

Sustainability is becoming crucial for businesses of all sizes as the public's opinion on the environment matters. To stay ahead of the curve, measuring your company's sustainability is essential. These construction KPIs will help you track your progress and potential future improvement areas.

The most important KPIs to track when considering sustainability are carbon footprint, energy consumption, product recycling rate, sustainability index, supply chain miles, water footprint, waste reduction rate, and waste recycling rate.

7. Customer satisfaction

A customer satisfaction KPI measures how pleased customers are with your project’s construction quality and processes. Tracking these metrics over time can determine if improving the experience will lead to increased customer loyalty and revenue.

Some factors one can consider measuring these metrics are:

  • Net Promoter Score to measure customer loyalty over time.
  • Customer Effort Score measures customer satisfaction based on the ease of completing a specific task.
  • Customer Satisfaction Score or CSAT measures satisfaction at particular moments in the customer journey.
  • CSAT measures whether your product or service matches your customers' expectations after one interaction.

These construction KPIs are important for cost management and safety, quality of the project results, staff productivity, sustainability, and much more.

Construction KPIs help you make the right decisions to ensure that your projects deliver true business value to the customer. KPIs are therefore essential to better control costs and schedule. They are meant to help determine which activities are relevant during the execution phase and could provide early warning signals to adjust the project.

While keeping track of cost management is essential, construction KPIs related to safety, quality, performance, staff, and sustainability are key to better-controlling costs and schedule.

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