Effective Management Reporting: turning data into timely decisions

What is management reporting?

Management reporting is the process by which required reports are designed and then delivered to project stakeholders. As we discussed earlier, we refer to both regular reports and ad-hoc reports prepared at the express order of any project stakeholder or a portfolio or program of projects. Project management is gaining increasing priority in organizations every year. This is due, firstly, to the fact that the rapid realization of a company’s strategic goals is practically only possible through high efficiency in project management, and secondly, to the fact that the number of projects is increasing year after year. That is why providing information to decision-makers about the status of ongoing projects becomes so crucial.

It is worth pointing out the essential elements that a good project management report should have:

• The report is readable and has a clear form; it can be presented in both graphical and tabular form
• The management report comprehensively provides information expected by project stakeholders.
• The report has a repeatable form from period to period, allowing you to compare data “apples to apples.”
• Reports are delivered on time
• The report is reliable, and the data in the report is checked and does not contain errors
• The report contains both numerical data presented tabularly or in visual charts, but also narrative boxes that explain the data presented

Initially, designing management reports within an organization can be a time-consuming process. Indeed, the first drafts require further iterations and improvements, but organizations quickly reach a state where the shape of the reports becomes stable. Still, MS Excel and MS PowerPoint are quite popular tools for preparing reports. However, more and more companies are choosing to implement dedicated tools for project and portfolio management, which can generate professional reports.

Goals of management reporting in an organization

Both in large organizations with Project Management Offices and those implementing multiple projects simultaneously, as well as in smaller organizations that undertake only a few key projects at a time, management reporting is crucial. The bottom line is that any organization implementing strategic and operational projects should ensure an excellent management reporting process. For managers responsible for executing the company’s strategy, which is often implemented through projects, ongoing access to reliable and well-presented reports is of tremendous value.

The key objectives of management reporting in the project management area are as follows:

• Project managers, project teams, and project stakeholders are provided with the same knowledge about the company’s ongoing projects, portfolios, or project programs
• Managers have access to reliable and timely information on the status of the company’s projects
• Based on reports that include both historical data and well-thought-out forecasts for the future, managers can make the required decisions promptly
• Presenting managers with both what has already happened and what, with some level of probability, may still occur within the project horizon
• Taking corrective action when the original project assumptions devalue over time and new circumstances arise that were difficult to predict at the outset

It is worthwhile for each organization to define its goals and main assumptions for management reporting and describe them in its project management procedure. As part of these assumptions, it is worth outlining the types of reports to be prepared, their compactness, frequency, the person responsible for preparing them, and to whom they are to be delivered.

Key elements of management reporting

The scope of management reporting in organizations varies. This is due to several factors, the most important of which are:

• The degree to which projects affect the implementation of the company’s strategy and its day-to-day operations
• The organization’s project maturity and the presence of a Project Management Office
• Expectations of project stakeholders
• Availability of data
• Availability of advanced IT tools
• Creativity of report preparers

The following is common information in project management reports:

• Deviations from the project schedule to the currently approved plan, often visualized on a Gantt Chart.
• Deviations of the project budget from the currently approved plan
• Key project risks and newly identified project risks
• Milestones achieved in the recent period and milestones to be achieved in the next reporting period
• Comments from the Project Manager and Project Management Office staff
• Overall project health
• Project roadmap for project portfolios
• Financial condition of the project portfolio
• Level of achievement of objectives set for individual projects, portfolios, or project programs
• The extent to which projects support strategic objectives
• Progress in meeting the project schedule and budget
• Key Performance Indicators (KPIs) of the project, project portfolio, or project program
• Level of current as well as future strain on key human and material project resources
• Number of hours worked on projects compared to the planned ones
• Status of completion of major project deliverables

It is worth noting, however, that the scope of reporting is also strongly dependent on the industry in which the company operates and, consequently, the nature of the projects it implements.

Tools and technologies to support reporting

Undeniably, the quality of management reporting strongly depends on the availability of modern IT tools. A wide range of IT tools is available on the market to support project management, portfolio management, or strategy execution. Using FlexiProject software as an example, the most important advantages of using a modern IT tool for preparing and distributing management reports are presented:

• Ease of creating any report layouts without any programming skills.
• Ease of creating reports of any scope: schedule, budget, risks, project condition, etc.
• Integrity of the solution – data once entered is consistent across different reports
• Ability to create cross-sectional reports combining information from different areas of project management
• Once created, reports are always up-to-date – a user opening a report has access to current data at any time
• The company can precisely decide who has access to what kind of reports and information

An example of a report generated in FlexiProject, concerning delayed milestones, is shown below. In such a report, the user can very easily decide the information scope of the report.

An exciting solution that FlexiProject software offers is Automatic Project Reviews. They support cyclical meetings of the company’s executives to assess the status of ongoing projects. For example, the company’s Management Board may decide to meet for half a day on July 12 to discuss the status of implementing strategic projects. Such a review could also concern the status of work on new products, investment projects, or optimization projects. The system itself will notify the relevant project managers of such a meeting, and their role will be to complete a one-page project status summary. In such a cyclical report, several tasks will be completed automatically. An example of such a one-pager is provided below.

FlexiProject software also allows you to create custom dashboards that are integral to reports, periodic reviews, or project portfolios. An example of such a dashboard is illustrated below.

How to prepare a management report? Best practices

Preparing a new management report should be done in close collaboration between the report designer—often someone from the PMO—and the report’s stakeholders. It is crucial to thoroughly understand the business purpose of the report and what decisions may be made based on it. New reports should be regularly improved during their initial lifecycle. This refinement should apply both to the substantive content of the report and its visual presentation. However, after a certain period, once the desired format has been achieved, the report should remain consistent. It is very important that users receive a comparable report period after period. This significantly facilitates fast analysis and quicker decision-making.

Below are several key guidelines to consider when designing management reports:

• Tailor reports to the audience – Different stakeholder groups require different levels of data granularity.
• Consistency and regularity – Reports should be delivered at clearly defined intervals.
• Automation of processes – Using reporting automation tools reduces errors and saves time.
• Data visualization – Charts, tables, and infographics help present key information in an accessible way.

It is also important to note that a more detailed report with more data is not necessarily a better one. Managers expect reports that are relatively easy to analyze and that provide essential insights enabling them to understand and assess the situation and make informed decisions.

Challenges and pitfalls in management reporting

Organizations with a high level of project management maturity and culture usually have a well-developed process and standardized formats for management reports. Reports generated periodically follow a consistent structure and are easily understood by stakeholders. In such organizations, there is a high level of trust in the accuracy of the reports, as they are based on reliable and verified input data.

The situation looks different in companies that are just beginning to develop their project management culture and processes. In these organizations, both the format and content of reports often change. Generally speaking, these changes and continuous improvements are a positive process that, over time, leads to stability.

When designing and improving the management reporting process in your organization, it is worth keeping in mind the following challenges and pitfalls:

1. Outdated information – Delays in reporting can lead to incorrect or late decisions. Therefore, when designing the management reporting process, it is advisable to include daily, weekly, and monthly reports. Good IT systems, such as FlexiProject, provide real-time reports that are always up to date when accessed—assuming that data is regularly updated by Project Managers and project teams.
2. Lack of standardization – Inconsistent report formats can lead to informational chaos.
3. Reports not aligned with recipients’ expectations – In many cases, such reports are not even analyzed and do not form the basis for decision-making.
4. Overly detailed and user-unfriendly reports – “More” does not always mean “better.” Overloading stakeholders with excessive information does not increase the value of a report; often, it does the opposite. Reports should be intuitive and presented using a combination of graphic, narrative, and tabular formats.

Management Reporting in Practice – Key Takeaways

Management reporting plays a vital role in effective project management. Well-prepared, reliable reports, distributed regularly, ensure that all stakeholders have the necessary information about the project situation in the organization. With such insights, decisions can be made efficiently, and appropriate actions can be taken where needed. Designing the set of reports, as well as the process of preparing and distributing them, is most often the responsibility of the PMO. Good project management software tools are extremely helpful in ensuring effective and efficient management reporting.