How To Evaluate Your Software Project Success
No single criteria alone can determine the success of a software development project. Depending on your enterprise objectives, there are a plethora of metrics you can employ to evaluate the impact of software projects.
One set of software development evaluations will only show you a partial picture of the situation. Hence, in this blog post, we will evaluate the performance of a software development project against a few different goal types.
How to build practical software development evaluation
Clear and focused KPIs
Prior to choosing which Key Performance Indicators (KPIs) to measure, you should begin with identifying the goals you want to reach, which deliverables will help you obtain those goals, and what actions will support your deliverables.
It’s essential that your KPIs are SMART
For instance, let’s say one of the strategic objectives of a financial institution is to increase the number of users for its mobile banking app. An appropriate KPI for this bank can be acquiring 10,000 new users in the next six months by implementing Product Analytics to understand customer journeys better and optimise marketing plans to reach more audiences.
Select your measures thoughtfully
Several businesses track data merely since they always have, which results in excess of dubious KPIs. We advise keeping an eye on just a few critical metrics that are most pertinent to your goal. If you can’t use that specific KPI to make strategic decisions, that might be an indicator it’s not crucial to measure. Don’t spend too much effort tracking things that are not unhelpful. The more metrics you follow, the longer it takes to report on them. Having mountains of data can make it harder to sort out what’s vital and what’s not.
Software project success evaluations
Here are 7 categories with sample KPIs for software development evaluation we deemed necessary. You might not need all these metrics, but hopefully, they can give you ideas on how to generate better ways to manage your projects. Keep in mind that all parties should agree upon metrics before starting a project.
When it comes to financial matters, it’s essential to measure the profits that software can bring to your business. This section concentrates on metrics that can measure the influence of the projects on the bottom line of businesses:
- Return on investment (ROI): a key financial indicator that reflects on its profitability and indicates whether the IT project’s benefits outweigh its costs. Not every project is built to have a positive ROI initially. As some initiatives require more time to turn a profit, sometimes, the ROI should be considered long-term.
- Cost/Budget variance: the metric indicates whether your software project's expected cost is below or over the established baseline.
- Cost performance index (CPI: this metric concentrates on calculating the cost efficiency and financial effectiveness of an IT project through the formula: CPI = earned value (EV) / actual cost (AC).
- Planned value (PV): is the expected cost of the planned or scheduled project activities as of the reporting date. By comparing the PV with the other project KPIs, you can determine whether your project is ahead of time or has already consumed more budget than planned so far
- Customer acquisition rate
- Budget creation cycle time
These metrics help you understand whether your project supports your company's growth.
2. Customer satisfaction
Metrics in this segment should be able to illustrate your team’s capability to satisfy end-user expectations and how that coordinates brand perception.
Here are a few metrics to measure satisfaction:
- Number of support tickets
- Retention/churn rate
- Net Promoter Score (NPS)/ Customer Satisfaction Score (CSAT)
- Customer Lifetime Value
- Customer Effort Score
- Time to value
- Customer complaints
A recent McKinsey study found that most survey-based measurement systems fail to meet businesses’ CX needs despite playing a prominent role in conducting research. 93% of CX leaders reported that they implemented survey metrics like Customer Effort Score or CSAT - yet, only 6% can rely on measurement systems to make strategic and tactical decisions. Leaders identified low response rates, data lags, ambiguity over performance drivers, and the lack of a direct connection to financial value as vital flaws.
Instead, your business can opt for data-driven CX systems to decrease churn, increase revenue, and lower costs. To understand the customer journey and discover hidden trends, adopting a product analytics tool is worth considering. Primarily used by product managers, product analytics tool allows data-driven decisions for software development and maintenance.
If you’re considering which solution to apply, Mixpanel is one of the suitable options. It provides insightful reports, notifies directly within the tool, offers backend SDKs, and more at an affordable price for businesses of all sizes.
- Customer-level data lake:
- Predictive customer scores:
- Action and insight engine:
3. Product Engagement
Despite meeting all objectives regarding budget and deliverables, the project is still considered a failure if it can’t influence the market. The leading metric is whether it resonates with consumers.
Satisfaction and sales metrics are also counted for ‘’influence on the market’’, yet, KPIs for product engagement are one of the efficient methods to assess the most crucial aspect of success: if you’ve managed to create a product that your users genuinely value.
- User adoption
- New user onboarding
- Usage time
- Number of actions
These indicators can aid you in spotting clients who might be at risk of leaving by highlighting warning signs like incomplete onboarding, underutilized features, or abrupt drops in usage. On an individual, these analytics can reveal which consumers require additional assistance from a sales or service representative. Over the long term, they can assist your development team in locating and eliminating friction points for a more seamless experience.
4. Agile Metrics
Agile metrics gauge the effectiveness of team planning and decision-making.
Even though they can’t inform the impact of the software on your strategic goals, they help enhance the development process, which contributes to better output quality.
Important KPIs you should be evaluating:
- Lead time
- Cycle time
- Team satisfaction
- Sprint burndown
- Code coverage
If any of these metrics deviate from the intended range or show that the team is falling off track, it’s critical to consult your team before taking action based on any presumptions you may have about the issue.
If your goal involves gauging the development team’s effectiveness, you might want to focus on deliverables.
These KPIs can help you understand the causes behind delays, explore chances for automation, or whether your team is making errors that necessitate reworking.
- Total output
- Schedule variance
- Code churn
- Number of change requests
- Quality assurance
Another crucial aspect of the success of various software projects is the timeline, which is the length of time it takes to complete the project.
Generally, a project timeline is often decided upon during an initial meeting with other stakeholders at the beginning of the project. Stakeholders frequently consider a project to be successful if the deliverables are produced by the project team within the specified time frame.
The project’s timeline is essential as it can contribute to many other success factors, consisting of resource availability and overall project budget. This metric can be measured as:
- On-time completion rate
- Time saved
7. Risk Management
Understanding the project's risks helps improve management and increase the likelihood of a successful project. The software is considered effective since the risks are managed at an acceptable level for customers and stakeholders when using or investing in it.
As every project has tangible or intangible risks, it’s responsible for an experienced project manager to be aware of and identify the risks in advance.
Collaborating with project managers is important to establishing what successful software development looks like from a productivity perspective. These decisions should also be shared with the entire team along with clear guidelines for success in the context of their duties and responsibilities.
Overall, these KPIs can support you to enhance management strategy, measure employee productivity and determine ways to improve, subsequently delivering high-quality products to market faster.
Fundamentally, evaluating project success implies analyzing each component contributing to the greater whole.
Bear in mind that this can’t be completed (at least not effectively) in a single report. Rather, you will have to concentrate on one goal at a time to gauge its true impact and pinpoint clear, practical activities for improvement the next time.
Software development is the heart of KMS Solutions. Our dedicated development team approaches projects with a sharp focus on quality and client outcomes. Accompanying clients through every step of the development process, KMS Solutions provides an effectual product roadmap with personalized software design evaluations for that project. Talk to our experts today to start a successful software development project.