KPIs overview

By:
Abdulrahman Almutairi
Objectives:
• Strategic
• Strategic plan VS operation plan
• What is KPI?
• The perfect KPI in CREAM technique
• What are the KPI types?
• Build the KPI.
• Choosing the right KPI
• Methodology to build KPI
• KPI tree
• Source of chosen KPI
• Balance Scoured card (BSC)
• Value Efficiency Analysis (VEA)
• Targets
• Baseline
• KPI tools
Strategic For best results, the
strategic goals should
not be more than 6
• What is strategic?
strategies
➢ It is plan has studied well to achieve the
organization goals, with no cost or lower
cost.
• What is planning? Mission/ Vision /Value
➢ it is process of thinking to provide the
needed to achieve the desired goal.
➢ Planning has 2 type of plans:
Internal and External evalution
o strategic plan : locate the goals need to
achieve
o operation plan: care about the actions
needed to implement the strategic plan and Build strategies / develop
it focuses on requirements to achieve the strategy goals
goals.
• What is SWOT analysis?
➢ It is a strategic plan technique used to help KPIs
organization identify external of Strengths,
Weaknesses, Opportunities, and Threats.
 Strategic plan VS operation plan

strategic plan Operation plan

5 years and up, updated every year No more than one year and updated
every 3 months

Talks about what the organization Focus on how the organization going
need to achieve to achieve

Thinking on the future Thinking on present

Focus on planning focus on implementation

Depends on all deportment plan Depends on induvial plan

Huge and wide GOALS Accurate and specific GOALS

What is KPI?
• It is types of performance
measurement that evaluate the
success of an organization or
particular activity.
• It is can measure the performance
on the level of :
✓ Organization/ company
✓ Department/ team
✓ Individual
The perfect KPI in CREAM
• The best KPI should be:
• Clear: the name of the KPI describe
what we measure.
• Relevant: it has strong relation to
desired goals.
• Economic: the additive value justifies
the effort and cost.
• Adequate: it is adequate to measure
success to achieve the goals
• Monitorable: it measurable and easy
to trace.
 KPI Types
1. Leading indicators : measure a performance that can create
value in the future.
2. Lagging indicators : it focus on previous performance
3. Qualitative indicators: do not show numeric measures as
such. Rather, they depict the status of something in more of
qualitative terms.
4. Quantitative indicators: indicates a quantity. The quantity
can be a pure number, an index, ratio or percentage.
5. Effectiveness indicators: Achieve ultimate value regardless
of the efficiency of available resources.
6. Efficiency indicators: using the available resources to
achieve additional value to the organization.
➢ The most common and important indicators are(Leading &
Lagging)
Build the KPI
• There is two ways to build the KPIs:
➢Of the shelf: you can take it from internet there is more than
20,000 KPIs ready.
➢Brainstorming: you can have team set together and try to
inventing KPIs for the organization.
❑ In this table some barriers of each way:

Of the shelf (( ready from web) Brainstorming

It might not work for the
organization
Measure the business from
wrong window
Worst way to build KPI
KPIs has zero relation to goals
List has no end of KPIs
Waste of time and resources
Choosing the right KPI
1. Using a standardized and approved way
2. Connect the KPI with the value, vision, and goals of the
organization.
3. Identify the source of the chosen that KPI.
4. Apply the Value Efficiency Analysis (VEA).
5. Balanced KPIs for each strategic goal.
6. Launch workshops and duscission to select KPIs.
Methodology to build KPI
Planning Creative Published
Clear strategic Build KPI tree Provide and analysis
reports
Provide need resources Build specific list Share the KPIs and
dashboard.
Inform stakeholder and Document the KPIs
evaluate present statue
determine the targets
 KPI tree
• determine the desired Objectives
objectives for the
organization
• Determine employee Themes
themes performance from
job description.
• Determine employee roles
performance from job
Role Role Role
description.
• Determine the right KPI for KPI KPI KPI
each role.
Source of chosen KPI

Reports from competitors Strategic plan 3-5 years

Secondary

KPI catalogs Operation plan

Internet KPI catalogs Annual reports
Annual reports from Internal operational reports
competitors
Supplier input/ customer input Front line staff input
Primary

Tips and recommendation of Project manger/ department

specialists input
KPI Discussion and workshops Board and partners input

External Internal
Balance Scoured card (BSC)
• It is a tool of strategic planning using in the organizations to
manage and measure their performance based on their goals
and vision.
• This tool has published in 1996 by Kaplan and Norton.
• This tool has been chosen by Harvard Business Review as one
of the most influential tool in management during the last 75
years.
• It helps the organization:
➢Effectively measuring organizational
➢Successfully implementing strategy.
Value Efficiency Analysis (VEA)
• It focuses on the value analysis for each goal.

Goal Input Process Output Outcomes

▪ Goal: The goal you need to analysis it

▪ Input: measuring the availability of resources that need on the
processing
▪ Process: measuring the efficiency of the actions in using input and
convert them to output
▪ output: measuring the efficiency of production or service that
provided from the organization
▪ Outcomes: measuring the impact of using the outputs to achieve the
organization goals.
 Targets
• It show the level of result needed to reach.
• Locate point to reach in process of measurement and analysis
on the level of action.
SO, Target is describe the requirement level of performance for
the KPI on the organization, department, or individual.
➢Properties of targets: • Set up value of targets

❖Targets match with KPI. • Determine the direction

• Find thresholds
❖Targets are measurable.
• Identify thresholds
❖Targets are time-bound.
❖Targets cover performance gaps. To build targets
❖Targets clarify the expected performance.
 Targets
• To get the benefit of the KPI, we need to determine the
acceptable results and unacceptable results.
• The methodology that using on thresholds KPI: (traffic light )
❑2 measurement points: ❑ 4 measurement points:
On target or above above target

On target
Under the target
On the acceptable target
❑3 measurement points:
On target or above Under the target

On the acceptable target

Under the target

 Baseline
• The baseline for KPI is the average current level of
performance of the organization that will use to compare level
of performance on future and test the improvement of
performance.
➢ supportive factors to determine the baseline:
✓ Internal analysis
✓ External analysis( market trends )
✓ Historical records of the organization.
✓ Analysis of competitors.
 KPI tools
❑ The most popular tools:
• Tableau
• Microsoft office- Power BI
• QLIK
• SAP
• SPIDER STRATEGIES
• QUICKSCORE
Thank you..