Key Performance Indicators

The auditing and advancement of any companies systems, processes, departments, accounts, inventory, standard operating procedures, one page strategic plan (OPSP), big hairy audacious goal (BHAG), financial documentation, and essential oversight and compliance MUST utilize key performance indicators (KPI’s).

In order to monitor, manage, and ultimately achieve any goal, any success, any financial dream, one must define the key performance indicators to help keep the course. A company’s course can be wracked with the unexpected, smashed by opposition, manipulated by internal and external interests, and growth stricken by a lack of knowledge or concern.

Necessity of Key Performance Indicators:

• Because without reference points on a company’s compass, the ship can be overtaken competition, or even worse, lost in a sea of chaos and disfunction.
• Because we can only gauge the success or failure of a company’s decisions when we keep score.
• Because failure is often hidden, obscured, buried and concealed.
• Because success can often be temporary when taken for granted, unrecognized by a superior, undeclared by the humble, and dismissed by past performance and compensation.

Key performance indicators allow the accomplishments of a company’s personnel to grow through positive reinforcement and any deficiencies to be discussed, addressed, and mended. Quantified success points eliminate confusion, necessitate discussion, and justify responsibilities, compensation, and advancement.

Here are a few questions to help identify key performance indicators:

• What is the employee, department, or manager’s top responsibilities?
• What do we want the company, employee, department, or manager to achieve?
• What do we want to define and acknowledge as an achievement or goal?
• What does the competition value?
• What is the dream, BHAG, goal, mission, hope?

Top Responsibilities: Identify what is the most critical responsibilities for any individual stakeholder or department within the organization. Employees, departments, managers, vendors, C-Suite executives, board members and officers, and equity owners should be able to identify from 3 to 5 absolutely critical obligations associated with their position. Just ask them…

What Do We Want to Achieve: The achievement, success, or growth desired will vary from each individual stakeholder and department. In order to facilitate positive reinforcement and job performance, the goals desired must be obtainable and well defined for each individual stakeholder and department. When each individual knows what is at stake, they will fight for it.

What Is Being Done: One Page Strategic Plan (OPSP) is one of the best ways to monitor ongoing progress and completion, the technique can be applied company wide or dialed in to specific departments or teams. Key Performance Indicators (KPI’s) are often a critical piece of the monitoring process that allow, at a glance, quantifiable results related to any projects, departments, employees, objectives, goals, or success targets. Both the OPSP and KPI’s are highly recommend to know what is being done.

Competition Values: Competition or industry markers are great starting points for setting up OPSP’s and KPI’s; however, special emphasis should be placed on areas that the entity, department, group, or team can excel above and beyond standards. An area of excellence above and beyond the competition’s standards is essential to standing out. so strive for it. and define goal posts that will lead to results or projects that help stand out against the competition.