Web studio production monitoring

Before you evaluate something, you need to measure it. In previous materials, we built the production of a web studio. Now let's learn how to measure its effectiveness. As soon as we learn to measure, it will be clear what needs to be improved. In our business, any, even the most insignificant effect, can give a significant increase in profit.

Offering website development at low cost and providing high quality, you can be sure that you will not run into a lack of orders. But keep in mind that from a business perspective, such a model is very unstable. If you chase after the quantity, you can quickly lose your customers, and if you hesitate, you can completely go into the red, not having received a chance for development.

I was always interested in creating a balanced scorecard, focusing on which, it would be possible to effectively manage web production, striving for a middle ground. In this short article, I will talk about the performance evaluation system that we have been using in WebCanape for many years.

If you want to try this system on yourself, keep in mind that these indicators are most likely suitable for industries that, like us, produce a homogeneous product and have a clear pricing policy. Prices for sites vary depending on the functionality, but the pricing procedure is the same.

Web Studio Performance Indicators

The primary task is simply to get an estimate of the result of the work of production, looking at which, we can say, good or bad, we completed the month. For this we use 6 indicators.

General plan for income (CPD). This indicator indicates the ability of production to generate the necessary cash flow.

Everything is simple here. We set two targets: minimum and desired. The minimum is necessary to cover expenses with a small margin, the desired is to make a profit. Both plans increase monthly with the annual growth plan of the company.

If the indicator is not met, urgently take measures to improve work efficiency or reduce costs. If the indicator is good, think about additional services for your customers without expanding the staff of production.

Use of the fund of working time (FRV). This indicator indicates the level of discipline in production and the effectiveness of labor organization, which is the foundation for a successful business.

FRV consists of the total number of hours allocated to developers involved in the production. To calculate the indicator, we divide the actual time spent by the developers by the total FRV. The indicator is best displayed as a percentage. The higher this indicator, the better. The number of working hours per person per month can be found in any production calendar.

For us, the norm is 80%. This means that we spend 80% of the available working time fund on project work. The remaining 20% ​​we leave for training, tea, discussion of solutions for certain tasks, meetings.

Use of FRV for commercial projects (FRV $). Using this indicator, we evaluate the targeted use of the company's production resources.

By defining it, we find out what percentage of the FRV went into commercial projects. To separate the hours (commercial / non-commercial), we use trackers in Redmine, which makes it easy to cut statistics later on.

To calculate the indicator, we divide the total time for commercial projects by the time worked for all projects, and multiply by 100%. In our case, the FRV $ should be at least 80%. The rest of the time we can spend on internal projects and development.

Compliance with standards . Through this indicator, it is possible to assess the ability of production to fulfill the standards laid down in the cost of the product.

Each contract with a client is a certain number of hours to develop a project. At the end of the month, for each completed project, we calculate the amount of time spent and compare it with the planned (contractual) time, evaluating how much we met the standards or exceeded them. Remember the nameplate in the “ Web Studio Team Selection and Role Allocation ” material ?

To calculate the indicator, we divide the average planned time by the average actual time and multiply by 100%. It is normal if this indicator is less than 100%. The main thing is to ensure that it does not become less than 70%, and strive for a value of 100% or more.

Return on production assets (RPA). In fact, this is the total cost of the hour for which we worked a month.

This indicator should be no less than the planned cost of a standard hour in the studio. If it is less, it is necessary to take measures to increase work efficiency or more accurately (to a greater extent) to assess the cost of projects at the initial stage.

The indicator is calculated easily. The average project time (in hours) is divided by the average project cost. We take the data on the hours spent from Redmine or any other task manager, and the cost of developing the project from the contract.

Deadlines. The final and very important indicator for the assessment is the fulfillment of obligations by the deadlines.

To calculate it, we take into account the actual working days spent on the project and compare them with the planned contractual terms. We divide the average projected planning period by the average actual period and get an indicator of the deadlines. The rule is the same: the indicator should be at least 70% and grow every month.

If interested, I suggest that you familiarize yourself with the table that can be used for calculation.

I note that it makes sense to consider the above indicators not only in the context of the entire production, but also with respect to projects for each manager. The analysis of indicators separately for each project manager provides good ground for thought. This is the most valuable in these calculations.

We analyze the results for a month, for timely diagnosis of problems - we analyze it at meetings, look at bottlenecks, and use it to select the best developers and managers. Based on the same data, we calculate managerial staff bonuses.

How to work with indicators?

The first thing to do is to establish the regularity of data collection and analysis. It is not simple. For many employees, these are just numbers, but for you it’s a way to change for the better, increase efficiency. Make a ritual out of this, bring the work of collecting indicators into the rules of the head and do not accrue wages without it.

Achieve indicators:

• Implementation of the income plan:> 100%
• FRV use:> 70%
• Use of FRV for commercial projects:> 70%
• Return on production assets:> 90%
• Compliance:> 90%
• Deadlines:> 90%

Work with indicators consistently. Behind each of them is a significant number of changes in production and in the minds of employees. Achieve maximum results without raising the cost of projects. You can always increase the cost, and it is much more pleasant to do this when all the other indicators are normal.

Pulling standards may take 6-8 months, this is normal. The necessary numbers can be reached thanks to automation, the development of developers' qualifications, the rejection of part of the work, the correct approach to the choice of customers, price increases, in the end, and others.

Personally, comprehending everything on our own mistakes, we did not immediately pay serious attention to the indicator of meeting deadlines. When they realized the importance of this, an idea was born with a TV that still works properly.

Instead of a conclusion

Many will ask the question: “What about the quality indicator?” Why didn’t he enter this system? We believe that this concept is relative, and each studio has its own idea of ​​it. To comply with the technical quality indicators of WebCanape, we have developed a technology for the production of sites for small businesses, which includes 120 parameters (plus / minus). This checklist is checked by the testing service and the project manager before giving permission to lay out the site. The time required for quality control is laid down in the cost of the product and is taken into account when calculating the above indicators.

I hope I spoke about our production control system in an accessible way? In the next article I will write about the graduation of employees and the motivation system.

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WebCanape Team