An organization incorporates in itself the interests of a number of parties such as shareholders, customers, employees etc. So, it makes sense for arriving at mission, vision and values statements after evaluating the needs and requirements held by these groups, so as to reflect their positions in these statements.
This can be done by having a means to keep a constant check on the direction the business house is heading in so as to ensure that outputs are according to the expectations of the stake holder groups. KPIs are the tool to employ in this regard.
Various domains in which parameters can be formulated are strategic intent, shareholder value perspective, customer value perspective and other stakeholder value perspective. Strategic intent concerns the appropriateness of challenges, empowerment of workforce, relevance of sense of direction. Shareholders can be taken care of by indicators like percentage growth in dividends, percentage rise in economic profits, relevance of self-interest, etc. Degrees of responsiveness, relationship management, etc. are the indicators to consider when customer perspective is to be quantified. Further, perspective for the other stakeholders can be had from measures such as level of trust with employees, relevance of social responsibility, coordination among the interested parties.
One of the issues that may hamper the progress is the detailed study that is needed to arrive at the KPIs. These should represent the areas which have a bearing on performance of the operations. Moreover, mission and vision statements are broad in nature, so narrowing it down to few parameters can be a confusing and complicated task. However, these can be sidelined by staying firm on the basic idea behind the existence of the organization. This will help in making way through the mesh of indicators, both that count and those that don't.
Mission and Vision spell out in quantitative and qualitative terms the position organization strives to achieve thereby simplifying the job of filtering what pays and what does not. So, a way to monitor that the performance is going as per the desired standards would definitely be of help. Using KPIs that have been finalized after a careful examination of the internal and external factors, one can manage and measure performance. This will go into balancing the outcomes in such a way that every party gets the deserving benefits.
The crux of the matter is that KPIs help a group in observing the pre- set mission and vision to the nearest approximation; by alleviating the chances of diverging from the structured paths. Providing good quality products at minimum price and timely manner to clients, enhancing the inherent value of organization to keep the shareholders happy and guiding the overall movement of the business can be attained by placing KPIs embedded BSC in the day-to-day operations.
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