Tips for Creating and Using KPIs

Key Performance Indicators are the compass for Performance Management. They are how managers guide their individual contributors in the right direction toward their goals. Let’s talk about setting the right KPIs to keep you on track towards success.

What are KPIs?

A Key Performance Indicator is a measurable metric that demonstrates how well a company is performing against its key business objectives, quarterly goals, and priorities.

The importance of KPIs

Measuring the right KPI's is vital to the health and success of your business.

Tips for Creating the Right KPIs

1. Be clear on the objective

   • Ask the right questions, such as “What business results are we trying to impact?” or “What problems are we trying to solve?”

   • Then you can identify factors that influence the objective and create KPIs that measure progress towards desired results.

2. Less is more (don't make the ‘K’ in KPI obsolete)

   • The secret to what makes a KPI ‘good,’ lies not in the KPI itself, but in the actions taken towards it.

   • Don’t measure all moving metrics, measure what you want to move.

   • This helps your team not overlook the key metrics that matter most.

3. Be clear on the criteria for success

   • In order to ensure goals are met, you must make time to measure progress with clear set criteria.

   • Doing so gives you an opportunity to recognize potential challenges and take a proactive approach to prevent issues.

   • For added clarity in strategy discussions, it is important to identify at what levels progress is considered, off track, on track, or achieved.

   • Engaging in regular performance discussions based on specific criteria, allows you to maintain a high-level view.

4. People analytics matter

   • In addition to the process side, include KPIs that monitor the health of your work relationships with employees, customers, and shareholders.

   • Maintaining balance is crucial to avoid fixing one problem at the expense of creating another.

   • Don’t expect to turn the heat up on productivity while leaving People analytics on the back burner. In other words, overlooking People analytics won’t improve productivity if your people are experiencing burnout.

Bottom Line

The process of identifying the right KPIs and effectively tracking progress, while maintaining a balanced approach to running your organization is at the core of company success. Achieve impactful results with meaningful performance management and deliberate KPIs.

Click here to learn how ConnectUs facilitates a work environment that is both people focused and result driven.