Key Performance Indicators for Construction Business
The construction business is tough, and several factors contribute to its challenges, including competition, financial risks, regulatory compliance, skilled laborer shortages, supply chain issues, and economic cycles. Not to mention the long hours and physical demands.
To overcome these challenges and run your best business, consider tracking and measuring several KPIs (Key Performance Indicators) from several categories of the business, including:
Project Management: Project Completion Rate, Schedule Variance (SV), Cost Variance (CV)
Financial Performance: Gross Profit Margin, Net Profit Margin Cash Flow
Operational Efficiency: Labor Productivity, Equipment Utilization, Rework Rate
Safety and Compliance: Incident Rate: Regulatory Compliance
Customer Satisfaction: Customer Satisfaction Score (CSAT), Net Promoter Score (NPS)
Sustainability: Waste Reduction, Energy Efficiency
When you're consistently monitoring the effectiveness of your systems and operations you are more likely to properly allocate funds, avoid potential risks, increase profitability, and properly prepare for the slow seasons.