When you start trawling through all the lists of KPIs (or performance measures, which is the term I prefer to use) that are lurking on the internet, you’ll see just how many performance measures there are. Thousands. Even within just one industry.
And many of these so-called performance measures aren’t in fact measures at all. A performance measure is evidence of the degree to which you are achieving an important result, over time. And that brings us to the first tip for making the best use of KPI master lists:
Tip 1: Know how to recognise a real performance measure from a fake.
“Existence of Business Plans” is not a performance measure. It’s the result of an action. “Employee Survey” is not a performance measure. It’s a data collection instrument. “Monthly Average Delivery Cycle Time” is a performance measure, because it gives feedback of a result, over time. You’ll need to be wise enough to pick out the real measures from the fakes.
Tip 2: Before you even go looking for KPIs, clearly define your priority business results.
To avoid swamping yourself with way too many trivial and irrelevant measures, you need to fish these KPI master lists with a net designed to catch just the types of measures you need. And that net is made from the business results that are your highest priority to achieve. After all, that’s what KPIs are for: to give you feedback about the results that matter.
Tip 3: List potential measures first, then evaluate to select the best.
It will be faster and easier if you list a dozen or so potential measures for each important business result that is worth measuring. So trawl through the KPI master lists quickly, just to pull out this first list of potential measures. After that, evaluate the potentials, and decide which measure (or two) will give the best evidence of your business results.
Tip 4: Be prepared to tailor the measures to your business.
The vast majority of KPI master lists will offer you nothing more than a measure name, and if you’re lucky, a short sentence describing what it means. That’s just not enough for you to successfully implement the measure in your business. So be prepared to flesh out each measure in more detail, right down to the data you’ll use to compute it.
Tip 5: Don’t fit a square peg to a round hole.
It’s entirely likely that your business or organisation is unique is some way. And that means that the complete set of performance metrics it needs won’t be out there in someone else’s KPI master list. You’ll have some results for which you’ll just have to design your own measures, from scratch. It will take you an hour or so to do this, but that’s much better than wasting weeks, months or years measuring the wrong things, or not measuring the right things at all.
ABOUT THE AUTHOR
Stacey Barr is a specialist in organisational performance measurement, helping corporate planners, business analysts and performance measurement officers confidently facilitate their organisation to create and use meaningful performance measures with lots of buy-in. Sign up for Stacey’s free email tips at www.staceybarr.com/202tipsKPI.html and receive a complimentary copy of her renowned e-book “202 Tips for Performance Measurement”.