How should a new KPI change your business?
Data gained from Key Performance Indicators (KPIs) is great for giving your business tips as to how it should grow and improve. However, like all good advice, you have to be prepared to take the hints that KPIs give you and implement them properly for the system to work. Matching the demands of a new KPI aimed at expansion or diversification will also require some major infrastructural changes.
The first point to consider is how you will harvest the data needed to make the KPI work. While sales figures, timesheets, and turnover can be transferred from tills and accounting spreadsheets, KPIs such as customer satisfaction and brand perception might prove more difficult to monitor. If you're collecting data by hand or using feedback forms, you'll need some way to input it into your KPI software suite. Consider whether you've got the right equipment, spare time, staff, and expertise to track the data you'll need. A KPI is practically useless without its underlying figures. Your time is best spent analysing relevant, easily measurable performance data.
Who needs to know about your KPI?
Monitoring your percentage growth in translated sales per year may go down well with investors, but it won't be of much use to the average employee. Likewise, data on which products are selling best and at what times may benefit frontline workers far more than overall sales figures presented to the boardroom.
Make sure that directives are in place to inform the right employees of what they should concentrate on improving. These directives can take the form of direct, simple, personalised micro-KPI targets (such as 'Increase 10 sales of our best-selling item to 15 per month by Q4'). A tiered chain of precise commands will result in larger, structural successes falling into place.
How can I adjust the business to fix problems highlighted by a KPI?
KPI Data is worthless if you can't make changes or identify exactly what's causing your results. Each KPI should have a full action plan attached to it that outlines what should be done in the event of failure or success. While this may amount to 'do nothing', failure should always raise questions. What has caused the target to be missed and why has it been missed by this margin?
Monitoring the variables involved in the process that's going wrong is the first step to building a solution. The creation of more precise, focused sub-KPIs can result in you discovering misdirected productivity, chronic employee absenteeism, uncompleted assigned work, and departmental overspend. Likewise, linking KPIs to a flowchart can help break down what stages of a project or plan are underperforming.
Our Performance Management Suite provides you will everything you need to keep track of KPIs and ensure that your team are on track to achieve all their goals. To find out more about how KPI-specific software can enhance your business, contact us today and we’ll be happy to talk you through the process.