Design KPI - Key Performance Indicators
How to design Key Performance Indicators? Start with
analysis of business goals, define key processes, suggest and check measures
and KPIs. Design KPI step-by-step:
Software product that helps creating KPIs:
Learn how to design KPI and Balanced Scorecard in
practical e-training:
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Design KPI step-by-step
Step - 1. Define the business problem
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According to your strategic goals what are your major
problems?
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Choose one of the problem that you want to address
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Who is responsible for this problem? You will need to
involve this person in KPI design
Step - 2. List 3-4 processes connected to the problem
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Analyze current business processes to define possible
solutions
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Brainstorm 3-4 approaches to the solution of the
problem
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Exclude solutions and processes that are too specific
Step - 3. Define measures for each process
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How can you measure the progress of your colleagues
about the solution or process?
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What is “success” and “failure” in this case
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What is the current state and what is desired result
Step - 4. Check if measures are actually measurable
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Can you get the numerical value for your measure?
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How can you estimate the current state of your
measure?
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What data should be used to estimate the current state
of the measure?
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What is measurement algorithm?
Step - 5. Add details to your measures
Add descriptive title
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Add measure units
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Answer the question – what steps we need to do to
measure it
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Specify baseline and target values
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Specify min and max values
Step - 6. Group indicators
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Consider business problems from viewpoints of Finance,
Customer Relationship, Internal Processes, Education and Growth
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Add to each perspective at least 3-4 indicators
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Design such KPI for each business unit in your company
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