KEY PERFORMANCE INDICATORS (KPI's) are vital to any business.
Remember - "What does not get measured - do not happen !"
Tracking the KPIs of a STRATEGY PLAN seems to me to be VERY OBVIOUS ! But do companies do it properly - I don't think so ! ...I can see you asking ...what do I mean ..? An example : if part of the CUSTOMER PLAN is to "get new customers". Do you ask your salesteam
- how many did you get this month ?
- where is the target list - how many vs target did you achieve ? You can track this and measure it. We use a traffic light system - Green meens achieved, Amber means needs work, red means - not achieved. Oh and there is Blue - which is for over achieved - Blue for Brilliant !! Another example : If as a Director your objective is to have more "top-to-top" meetings with suppliers. Do you set a KPI and measure it ? - say 3 meetings per month. Again this can be measured. TRENDS Trends are also something you should try and measure. Once you have KPIs you can then plot a trend. For instance a KPI might be average bank overdraft figure daily.
Is the monthly average borrowed as a trend increasing or decreasing. Good to watch trends - they can be a good warning signal. Software OK this is not a pitch for my company..... I am so passionate about Key Performance Indicators and the tracking of them that I have built two software companies that do this - they are Enable and Enable Infomatrix. We have a product that measures strategy called a "KPI Flightdeck" and it uses a data management system we developed called Circle. The flightdeck of an aeroplane is vital to make sure the aircraft stays in the air. Gauges such as fuel, altitude, gyros are all vital. In the same way your business has these vital gauges - CASH AVAILABILITY (HEADROOM)
SALES
PROFIT
PROFIT MARGIN
STOCK levels
DEBTORS
CREDITORS
AVERAGE DEBTOR DAYS
AVERAGE CREDITOR DAYS
NET DEBT
...these can all be measured daily (if not weekly) and closely monitored. |