The A&E Firm’s Guide to Project KPIs: How to Measure What Matters Most

In the architecture and engineering world, business success isn’t just measured by beautiful buildings or well-engineered systems—it’s measured by performance. That means tracking the right numbers at the right time and using them to guide your decisions. While firm-wide KPIs help you understand overall business health, it’s project-level KPIs that truly determine how profitable, efficient, and sustainable your work is. 

Project KPIs give you visibility into how time, money, and people are being used across individual jobs. They’re the early warning signs that keep projects on track and the strategic tools that drive firm growth. Yet too many firms either don’t track project KPIs at all, don’t have the tools they need to track them, or they collect the wrong data, too late.  

This guide will walk through the most important project KPIs for A&E firms, how to use them, and why they’re essential for building a stronger business. Whether you’re managing a two-person practice or a national multidisciplinary team, knowing your KPIs is how you stop reacting and start leading. 

Why Project KPIs Matter (and What Makes Them Different) 

Architecture and engineering firms thrive when their project delivery is efficient. Every invoice, every payroll, and every future opportunity is rooted in how well your team executes the work already on the books. That’s why tracking performance at the project level is so crucial.

While firm-wide KPIs like net revenue, realization rate, and overall profit margin give you a bird’s-eye view of the business. Project-level KPIs tell you how each individual project contributes to, or detracts from, your overall performance. Looking at project metrics answers the why, when you are discussing firm-wide performance, and the how, in terms of achieving your goals.  

Firms that ignore this layer of visibility often experience common challenges: 

• They deliver great work but struggle to understand why some projects lose money

• They scale headcount without knowing whether the existing team is working efficiently

• They wait until the end of the project to assess success, rather than course-correcting in real time 

In contrast, firms that embrace project KPIs can: 

• Spot overruns before they become emergencies

• Hold teams accountable to budgets and timelines

• Forecast future staffing and cash flow more accurately

• Make data-backed decisions that improve both project outcomes and firm profitability 

The Difference Between Firm-Level and Project-Level KPIs 

To clarify, here’s a simple breakdown: 

Both types of KPIs are essential, but project-level KPIs give you the day-to-day control you need to protect profitability, deliver value, and make smarter decisions as a manager or firm owner. Project KPIs are also data that can and should be shared with your team, so everyone is engaged in improving operations, increasing efficiency and delivering projects in a way that is great for clients and profitable for the business. 

The Most Important Project KPIs for A&E Firms 

Let’s explore the key metrics every A&E firm should track at the project level, what they mean, why they matter, and how to use them effectively. 

1. Project Profitability 

What it is: Net profit for an individual project (Revenue – Costs) 
Why it matters: This is the clearest indicator of whether the work you're doing is actually making money. 
How to use it: Review profitability by phase, team, or time period to see where you’re gaining or losing margin. Use the data to adjust future fees, improve processes, or negotiate smarter. One tip: project costs should include everything that goes into delivering that project, including the cost of time on project-related activities or expenses that may not be directly billable. 

2. Earned Value vs. Planned Value 

What it is: A comparison of the actual work completed (earned value) against what was scheduled to be completed (planned value). 
Why it matters: Helps track whether a project is progressing as expected in terms of both budget and schedule. 
How to use it: Use this KPI to assess whether you’re ahead, behind, or on target, especially in fixed-fee projects where progress doesn’t always align with effort. 

3. Work-in-Progress (WIP) 

What it is: The total value of work done but not yet billed. 
Why it matters: WIP is critical for managing cash flow and understanding backlog revenue. 
How to use it: Monitor WIP to avoid delayed billing and to forecast revenue more accurately. 

4. Effective Billing Rate 

What it is: Total billings divided by total hours worked on the project. 
Why it matters: This shows how efficiently the team is converting time into revenue. 
How to use it: Compare the effective billing rate against your target billing rate to understand project efficiency. 

5. Percent Complete 

What it is: An estimate of how far along a project is, typically based on milestones or task completion. 
Why it matters: It's a leading indicator of whether a project is progressing according to plan. 
How to use it: Align percent complete with budget burn and hours used to check for inconsistencies or red flags. 

6. Budget Burn Rate 

What it is: The pace at which the project budget is being consumed over time. 
Why it matters: Helps identify whether the project is over-consuming resources too early. 
How to use it: Monitor this weekly or biweekly to manage the pace and avoid exhausting the budget before project completion. To get a clear visual of this metric, use burn up charts, which are common on project dashboards in firm management software tools. 

7. Unbilled Time and Expenses 

What it is: Time or costs incurred but not yet invoiced. 
Why it matters: High unbilled balances may indicate invoicing delays or missing billables. 
How to use it: Use this KPI to catch and recover missed revenue opportunities. 

8. Forecast Accuracy 

What it is: A measure of how closely your original budget and schedule match actual outcomes. 
Why it matters: Indicates the effectiveness of your project planning and estimation processes. 
How to use it: Compare initial plans to actuals at project closeout to refine future forecasting. 

For a more in depth understanding of these metrics and other financial terms, check out our updated Glossary of Terms that outlines the common terminology used when discussing and analysing firm financial performance and operations. 

Using KPIs to Drive Performance 

Having the right KPIs isn’t enough. You need to know how to use them. The most successful firms make KPIs part of their regular project management rhythm. And regularly train their staff in what to look for and what the metrics mean. That means: 

• Setting clear targets at project kickoff

• Monitoring in real time rather than waiting for project completion

• Embracing Data Transparency across the entire team. 

• Discussing KPIs in weekly team check-ins or PM meetings

• Visualizing data using dashboards, not just static spreadsheets

• Tying performance to accountability and recognition

When KPIs are integrated into the project lifecycle, they become proactive tools, not just retrospective reports. And when your whole team has access to this information they are empowered to make better decisions and help keep projects on track. Further, you can see which projects and which teams are highest performing, and you can pass lessons learned on to other people at the firm. 

Best Practices for Implementing KPI Tracking 

To get the most from your project-level KPI tracking and review: 

• Keep it focused. Don’t overwhelm your team with too many metrics. Start with the 4–5 that matter most to your business model and the success of individual projects.

• Standardize definitions. Make sure everyone agrees on what “percent complete” or “profit” means. When in doubt, you can reference our Glossary of Terms to get everyone on the same page. 

• Automate data collection. Use tools that pull data directly from timesheets, budgets, and invoices. Have them automatically sent to the right people on the right dates. 

• Train your team. Don’t assume PMs know how to interpret or act on the data. Regularly train everyone on the team about what metrics should be tracked and why. Don't limit training only to PMs, but engage everyone so your team is constantly leveling up. 

• Review regularly. KPI reviews should be part of your monthly or even weekly project rhythm, not something saved for project closeouts or after-action reviews. It may even be helpful for Project Managers to review data daily in some cases.  

Common Mistakes to Avoid 

• Tracking vanity metrics. Just because something is easy to measure doesn’t mean it’s meaningful. Find the right metrics that correspond to project and firm success. 

• Using KPIs reactively. Don’t wait until a project is failing to look at the data. Check reports daily or weekly and make small adjustments to keep projects on track. 

• Ignoring context. KPIs are guides, not judgments. A low billing rate might be okay if it’s part of a strategic loss-leader or a long-term client relationship.

• Failing to align KPIs with business goals. Make sure the metrics you track reflect what success actually looks like for your firm. 

The Role of Technology in KPI Success 

The firms that get the most value from KPIs are those that embed them into systems that are integrated across the firm. Spreadsheets or unconnected apps may work at a small scale, but they can’t provide the real-time visibility or integration needed to manage complex projects or growing teams. Finding the right technology that empowers your team and syncs the important data across all aspects of your business will give you a huge advantage. 

Firm management software designed for A&E businesses streamlines KPI tracking by: 

• Pulling live data from timesheets, budgets, and invoices

• Visualizing trends in dashboards and reports

• Allowing project managers to spot issues early and course-correct quickly

• Ensuring everyone, from principals to junior staff, has access to the data they need to be effective in their roles. 

By using purpose-built tools, you not only improve your accuracy, you make KPI tracking part of your firm culture. Through dialogue, training, and automation, you should make data-driven decision-making an integral part of your business across all teams. 

Conclusion: Measure What Matters, Manage What Matters 

Project KPIs are more than numbers. They’re the story of how your firm operates. When you track the right metrics, review them consistently, and use them to guide your decisions, you shift from reactive management to strategic leadership. 

In the end, profitability, client satisfaction, and long-term growth all depend on how well you manage your projects. And managing projects well starts with measuring the right things. There are metrics that you should track for overall firm performance, but once you identify key trends, you want to use project-level reporting to understand the why and how. 

Want to take the next step in managing your firm by the numbers?

Book a free strategy session to discuss the specifics of your firm and see how firm management software can give you the insights and data needed to drastically improve your firm's performance.

Don't believe that it is worth the investment? Through our benchmarking research compared to recent AIA reports, firms that use all-in-one firm management software like BQE CORE, generate approximately $13,000 in higher revenue per employee than the industry average. 

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