| Driving your business forward is much easier when | | | | team, may highlight the need for more or less staff or |
| you have a destination in mind, but how do you | | | | another solution to ensure this area of the business is |
| determine if you are on track during the journey? Key | | | | on track to achieve the overall goal. |
| Performance Indicators (KPIs) represent the signposts | | | | Implementing or improving the KPI system within your |
| along the way to ensure your business is on track to | | | | business will assist everyone to work towards |
| meet its goals, and to warn you when you're veering | | | | common goals with clear objectives. KPIs will also |
| off course. | | | | assist managers to manage effectively, help define |
| KPIs are a commonly used business performance | | | | expectations and recognise success, evaluate |
| management tool, particularly popular because of their | | | | progress and provide evidence for necessary |
| ability to measure a very wide-variety of criteria | | | | changes to business processes. Externally, results |
| across all business departments - including often | | | | against KPIs can prove an important snapshot of the |
| hard-to-measure criteria. KPIs are developed to | | | | business to investors, stakeholders and regulatory |
| measure important business processes in your | | | | bodies. |
| organisation. The KPI will measure for success based | | | | However, your unique KPIs need to be developed with |
| on your criteria and then provide results, whether | | | | a few considerations in mind. You must recognise |
| quantitative or qualitative, as to whether the process is | | | | which KPIs align to your business success - it is not a |
| under-performing, on target, or exceeding expectations. | | | | Key Performance Indicator if it is not vital to your |
| Every business is unique and it is important to develop | | | | business success. Then determine how many you can |
| KPIs that are relevant to your business and your | | | | effectively manage - only choose KPIs you can |
| expectations. It is advisable to develop your KPIs to | | | | successfully monitor and ensure you implement |
| that well-known acronym SMART: | | | | systems to support supervision. Plenty Systems |
| Specific | | | | recommends deciding on no more than 20 KPIs for a |
| Measurable | | | | small to medium sized business - any more will be too |
| Attainable | | | | hard to manage. Additionally, develop your KPIs using |
| Relevant and | | | | historical data, customer feedback, industry |
| Time-bound | | | | benchmarks and other relevant indicators - don't guess |
| For example, an important KPI within the call centre | | | | or the targets may not be attainable. You must also |
| industry is 'call answer time'. It is a specific business | | | | establish where it is fine to be average and where you |
| process, measurable in seconds, attainable, extremely | | | | need to excel. For example, sales figures may need to |
| relevant as a lost call may be a lost sale, and will be | | | | exceed all others comparisons, but you may only need |
| time-bound either within a month, quarter, year etc. The | | | | to meet industry benchmarks for employee training |
| results will highlight weaknesses or strengths within a | | | | hours to still achieve your business goals. |