6 types of construction KPIs to keep under control

Key Performance Indicators (KPIs) for construction are used to measure a project’s success. Find out which are the most important to monitor!

When starting a new construction project, each of us will have asked a thousand questions, wanting to know if everything will go according to plan and if the team will be able to meet the objectives established in design initial phase.

An effective method to answer these questions already exists. It is the monitoring of construction Key Performance Indicators (KPIs).

Don’t feel discouraged if you haven’t heard of these parameters yet! Below, I’ll explain their meaning and help you find out which are the most important construction metrics to keep under control ensuring your projects’ success.

Before you start, you need to know that as of today you can use a construction management software to plan, schedule and manage every phase of your construction projects. Try this tool now and find out how easy it is to monitor the progress of each activity in real time, thus solving all problems to stay in line with the design objectives.

What are Key Performance Indicators (KPIs) in Construction

Key Performance Indicators, or simply KPIs, are metrics that a company uses to evaluate its performance over time. In the field of construction, you’ll use these metrics to measure the project’s success thus verifying the actual achievement of objectives foreseen in the planning phase.

Construction management usually involves a multitude of factors, relating to construction safety, quality, productivity, times, costs, customer satisfaction and so on. For more complex projects these factors become so numerous that sometimes it is almost impossible to monitor them all.

This is where construction KPIs come into play. It is a set of meaningful parameters carefully selected to describe and monitor the project entire progress, providing a clear picture of how different activities are going.

Construction KPI monitoring

Historical KPIs and Predictive KPIs

The Key Performance Indicators used in construction can be grouped into two broad categories:

• Historical KPIs are past construction metrics activities. The various measurements and analyses are carried out on data relating to events that have already occurred. Historical KPIs are usually used to monitor the financial and operational aspects of a project such as costs, profit margins, resource utilization, progress of work, change orders and more;
• Predictive KPIs: are measurements intended to predict the future performance of projects as well as the construction team. To determine these parameters, however, it is important to examine past projects understanding what has worked and what, instead, are the aspects to be improved. Predictive KPIs are essential to guide decision making, measure future productivity levels, assess economic trends, and avoid undesirable outcomes.

Why KPIs are Important in Construction

Keeping track of progress and monitoring a project’s performance from different perspectives is the key to achieving pre-set goals more safely and reliably.

Key Performance Indicators for construction are exactly that. They allow to measure a series of aspects, both tangible and intangible, relating them to the project thus keeping under control the entire construction process.

Construction KPIs are a powerful tool that helps companies and professionals in the construction sector to improve their performance from time to time, achieving better results.

Monitoring these parameters allows us to understand how successful a project has been and how to use the information gathered for future projects, in order to avoid similar problems and errors.

This enables construction companies to identify areas in need of improvement, track progress over time and to make more informed decisions which helps improving efficiency and productivity.

6 Essential Types of KPIs for Buildings

Although it is possible to track an almost indefinite number of KPIs for each project, it is preferable to focus only on a few carefully chosen key parameters in order to measure progress towards achieving essential design goals.

The most important types of KPIs to monitor during a construction project development are the following:

1. Health & Safety
   measuring the safety level of a construction site is of foremost importance because a safer construction site entails fewer risks for operators and helps reducing costs in both the short and long term. Monitoring appropriate safety KPIs thus taking a proactive approach are key to minimizing the number of workplace accidents and injuries therefore increasing staff productivity. Among the most significant safety metrics we find, for example:
   • accident types, severity, injuries and frequency;
   • total number of H&S meetings/briefings;
   • number of accidents per contractor.
2. Costs:
   cost KPIs help determine the financial stability of the construction program. They also make it possible to predict future costs by comparing times and expenses required by different activities. By monitoring some key parameters, construction companies can optimize their processes keeping their finances under control. These parameters include:
   • the profit margin;
   • cash flow;
   • the construction cost variance;
   • cost of change orders.
3. Quality:
   quality metrics allow you to understand if the construction team is able to complete the project within the budget and on time. They also help to reduce subsequent changes and rework. The Key Performance Indicators that contribute to maintaining the high level of quality of a project are:
   • the number of defects;
   • time taken to correct the defects;
   • total number of on-site inspections;
   • the number of on-site inspections passed;
   • the ratio of number of inspections passed to the total number of inspections;
   • cost of rework;
   • customer satisfaction.
4. Performance:
   performance KPIs are an effective method of measuring worker productivity and understanding project’s performance. They allow you to quantify the time and resources needed to develop different activities identifying potential areas for improvement. Monitoring these parameters helps you to understand if you need to allocate additional resources or subtract some of them to achieve greater efficiency hence achieving project objectives. Construction performance KPIs include:
   • percentage of labor downtime;
   • percentage of machine stops;
   • the average daily/hourly income.
5. Personnel:
   monitoring the performance of employees and measuring their level of satisfaction is essential to ensure the project’s success. It is important to invest in staff well being because a satisfied worker is more motivated and engages more performing duties with greater care. All this helps to increase profits in the long term. Key Performance Indicators that help improve employee performance include:
   • turnover rate;
   • training completion percentage;
   • workers satisfaction rate.
6. Sustainability:
   sustainability indicators ensure that each project respects the principles of environmental protection and efficient use of resources. The most important KPIs that fall into this category are:
   • carbon footprint;
   • water footprint;
   • energy consumption;
   • waste recycling rate;
   • sustainability index;
   • kilometers of the supply chain.

Types of KPIs for Buildings

How construction management software can help achieve construction KPIs

Construction professionals and companies rely on construction metrics to monitor the efficiency and performance of their processes.

Although construction projects are characterized by considerable complexity, today you can count on the help of solutions that help simplify different activities management.

These systems are designed to monitor construction process’ progress in real time thus facilitating collaboration with stakeholders. They allow you to schedule and manage every project consideration at a single centralized location therefore simplifying workflows to avoid delays and problems of all kinds.

And they also offer powerful data analysis and BIM model visualization capabilities, helping you to make more informed decisions hence meeting design objectives.

To experience the potential of these systems firsthand, try a construction management software right away. Thanks to the potential of this tool you can manage projects, even large ones, ensuring compliance with budget and the expected times. You can also track all activities and turn any problems into simple tasks to solve. Through optimized workflow management you can seamlessly meet your construction KPI forecasts therefore ensuring all your projects’ success.