Key Performance Indicators For Dummies

Chapter 19

Ten Tips for Developing Effective KPIs

In This Chapter

Starting with strategy

Ensuring the right people own the KPIs

Communicating your KPIs for maximum impact and understanding

To ensure that you collect only commercially relevant data – the sort that drives results and supports fact-based decision making – stick to the following ten tips for developing effective KPIs.

Map Your Strategy

Always start with strategy. Without a firm stake in the ground about what your business is seeking to achieve, it is incredibly easy to end up with a dauntingly long list of possible indicators that you feel you could or should measure.

Your strategy therefore acts as a starting point from which you can then design appropriate KPIs. But it’ll only work if it’s clear! All too often companies create a 30- or 40-page strategy document that no one ever reads or understands. A really great way around this is to put the key strategic objectives on a single page to create a strategy map.

Identify the Questions You Need to Answer

Linking your KPIs to your strategy will immediately narrow your focus and make the relevant ones more obvious. Identifying the questions you need to answer will further ...