Key Performance Indicators
Tuning the Business Dashboard
Your Business Dashboard will depend on the objectives you are focused on. The Key Performance Indicators (KPI) that you consider are not be the same when you start a Business as if you are "on the road" at cruising speed or top speed.
If you ask me to help you defining your Business Dashboard, I will immediately give you back the question: What are the strategic objectives you have define in the four perspectives of the Balanced Scorecard planning:
- Financial Results
- Customer Satisfaction
- Business Processes
- Growth & Learning
Let your Information systems make their "Memory-Storming"
Your Information Systems can provide you with more valuable information than you expect and less than what you need.
Take profit of the 80-20 rule in this area also:
- the 80% of the results used to be accessible with only 20% of effort
- the remaining 20% will probably require the maximum effort
So, before working too hard, start looking for the information nuggets easy to pick.
Select the objective you want to track with indicators. Make an "Memory-Storming" of all the data available in your Information Systems and related with this objective.
Prune the results to keep only the 3 best indicators and analyze their relevance together with the Process Owners.
Make the Synthesis to better Analyze
Selecting only some indicators by objective or process, you are trying to summarize a performance in numbers, to quickly detect what is going wrong.
But you need also to be able to breakdown your Key Performance Indicator into sub-level value of this KPI by any criteria ( countries, segment, product, customer...) that can give you useful information about the drivers of this indicators and take the adequate decision to improve it.
Suppose that in your car you have an indicator to detect short-circuits in your electrical installation. Without others indicators about the localization of the problem, this KPI will probably not help you a lot with the solution.