Alsulamy, S; Wamuziri, S and Taylor, M (2012) Evaluation of key metrics for measurement of project performance. In: Smith, S D (ed.) Proceedings of 28th Annual ARCOM Conference, 3-5 September 2012, Edinburgh, UK.
Abstract
In the construction industry particularly in developing countries, minimal attention has been given to the application of Performance Measurement Systems [PMS], despite being one of the most important factors for assessment of project success. Consequently, there appears to be always a gap between actual results obtained in relation to delivery of major projects and stakeholder expectations. The application of performance measurement systems in the construction sector has tended to rely on three basic criteria: time, cost and quality, which can be applied to determine the extent of project success. At organizational level, performance measurement systems are largely based on financial measures which are almost always lagging indicators. In response to the Egan Report, the UK construction industry developed specific Key Performance Indicators (KPIs) which include construction cost and time, cost predictability and time predictability, defects, client product and service satisfaction, safety, profitability and productivity. The primary aim of this paper is to evaluate the main project and organizational performance metrics including financial and non-financial measures that have been developed in recent years. Lagging indicators focus on past data and offer little or no opportunity for process improvement. Previous research indicates that credible performance metrics should consider all construction project stages alongside stakeholder needs and expectations. In this work, the fundamental requirements for suitable performance metrics are identified. Finally, it is concluded that the shortcomings of current performance measures utilized by the construction industry can be considered as marketing tools as opposed to tools for process improvement.
| Item Type: | Conference Paper (Paper) |
|---|---|
| Uncontrolled Keywords: | performance measures; performance metrics; performance measurement systems; construction projects; project performance |
| Index terms: | major project, performance measure, productivity, construction cost, key performance indicator, project success, satisfaction, process improvement, performance metric, developing country, performance measurement, construction industry, construction sector, marketing, profitability, project performance, organizational performance, construction project |
| Subjects: | business, economic analysis, project delivery, financial and cost management, strategic project management, performance measurement, management, production management, project management theory and practice, development economics, industry analysis |
| Topics: | Cost Management, Business Strategy, Project Management, Research Practice, International Construction, Quality Management |
| Descriptive scope: | 3 PCT |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here