Key Performance Indicators (KPIs) October 18

DEVELOPING KEY
PERFORMANCE
INDICATORS
Aiman Ahmed Ibrahim
ACMA –CGMA-MBA
Developing Key Performance Indicators-Aiman Ahmed Ibrahim

COURSE OUTLINES
• INTRODUCTION
• WHAT ARE KEY PERFORMANCE INDICATORS?
• LINKS BETWEEN COMPANY MISSION, VISION, OBJECTIVES
AND KPI
• CHARACTERSITICS OF A GOOD KPI
• EXAMPLES OF KPI’S
• THE KPI CASCADE PROCESS
• HOW TO CREATE AND MANAGE KPI’S
• HOW TO PRESENT YOUR KPIS
• HOW TO REPORT YOUR KPIS
• SUMMARY

INTRODUCTION TO KPI’s
“In business, words are words, explanations
are explanations, promises are promises, but
only performance is reality.”

Introduction
• A Key Performance Indicator (KPI) is a measurable value that
demonstrates how effectively a company is achieving key business objectives.
Organizations use KPIs to evaluate their success at reaching targets.
• Selecting the right one will depend on your industry and which part of the
business you are looking to track. Each department will use different KPI
types to measure success based on specific business goals and targets.
• Once you’ve selected your key business metrics, you will want to track them
in a real-time reporting tool. KPI management can be done using dashboard
reporting software or any other tool available giving your entire organization
insights into your current performance.

A BRIEF HISTORY OF KEY
PERFORMANCE INDICATORS
• KPIs haven’t always been used for business purposes. While they are a very effective tool today
in companies like yours, they were once used for darker purposes. It was thought that in the 3 rd
century, the emperors of the Chinese Wei Dynasty began rating how the members of the royal
family were performing..
• Performance management and KPIs shifted to the industry in the early 19 th century, when a
Scottish miller used cubes of wood painted in multiple colors over the desk of each of his
workers.
• These primitive methods were changed in the 1900s as the military and industry expressed the
need for more effective performance appraisals.
• It is thought that the main cause of development of modern key performance indicators was a
group of human resource managers in the 1900s. Until the early 1990s, performance was
monitored individually. Employees were expected to meet the goals, but the overall performance
of the company was not taken into consideration.

The Introduction of Operational
Performance Management
• Using KPI dashboards to monitor the operations within a company didn’t get
utilized until accounting and management had evolved a little. The performance
of a business process is usually checked based on its efficiency. Using financial
KPIs through the accounting systems of your company is the best way to do
this.
• It was in the 1910s that management performance began to be measured as its
own set of processes. Initial methods were called work studies and required
that individual employees be measured based on their performance throughout
the work day. By the 1920s, large companies performed experiments to
introduce more decentralized structures. This marked the advent of the Return
on Investment concept, widely used today.
• To keep track of how management was sticking to the required ROI goals, the
DuPont chart was used. In the 1930s, France introduced a tableau de bord for
managers and c-level executives to track operational performance. This was the
first example of a dashboard being used in performance management.
Although French companies used dashboards extensively, language barriers
prevented them from going overseas.

How the Balanced Scorecard
Changed the Face of KPIs
• Key performance indicators saw the next big change in their usage in the
1990s when the first true Balanced Scorecard was used. This BSC was
created by Dr. Robert Kaplan and Dr. David Norton to monitor performance
that wasn’t just related to the financial progress of companies. Influenced by
the work done by GM and other companies in the 1950s, this was the first
“modern” KPI framework.
• Today, we live in a world governed by KPIs. They are used extensively in
every industry possible. They have evolved far beyond the simple
measurements they used to be. If you have KPIs in your company, remember
that the world is constantly evolving. As such, you may need to update your
current KPI framework sooner than you think.
What IS A KPI
• A KPI (Key Performance Indicator) is simply a
metric that is tied to a target.
• Most often, a KPI represents how far a metric is
above or below a pre-determined target.
• KPI’s usually are shown as a ratio of actual to
target and are designed to instantly let a
business user know if they are on or off their
plan without the end user having to consciously
focus on the metrics being represented.
Key Performance Indicator
Generally there are two approaches
• KPI based on Strategic themes
• KPI Based on Critical success factors
They both drive from:
• Objectives from strategic aims
• Performance indicators flowing from
objectives
• Status and progress indicators
• Year on year change indicators
Critical Success Factors
Critical success factors – key issues
requiring management attention
• Represent real issues faced “here
and now”
Performance indicators relate to
critical success factors not strategic
aims – offers greater flexibility
• Critical success factors can be
mapped to strategic aims

The 5-Step Process For Determining Critical
Success Factors
• Step 1: Pull together the team that will be working with the
CSFs.
• Step 2: Have employees submit their ideas or give feedback.
• Step 3: Use multiple frameworks to examine the key elements
of your long-term goals
• Step 4: Determine which factors are key in achieving your long-
term organizational plan.
• Step 5: Implement your company-wide strategic plan with your
critical success factors in mind.
How To Achieve Success
• Identify areas of activity that require greater

attention
• Performance indicators that are grounded (SMART)
• Striking a balance between a comprehensive set of
KPIs and information overload

SMART KPI’s:
SPECIFIC
TIME MEASURAB
PHASED LE
ACHIEVAB
RELEVANT.
LE

SOURCES OF POTENTIAL KPI
• Do the KPIs provide YOU with a clear indication of progress

to date and areas requiring greater attention?
• Strategic aims do not always lend themselves to
measurement and require associated objectives
• No difficulty with objectives extracted from the Corporate
Strategy but derived objectives may have no real ownership

The Benefits of Using KPIs in
Your Business
• The right information to make informed
decisions.
• Provide a systematic approach to KPI
reports
• Benchmarking for peer groups
• Reduce time in KPI reporting and
collation “What you measure is what you
• Tie your KPI's to balanced scorecards forget.” (Kaplan and Norton, 1992).
organizational strategy.
And ….. The longer list
• Allow users, managers and companies to • Online access anytime.
measure and manage targets and goals.
• Track the impact of initiatives.
• Use Simple KPI to track project performance
and report to project shareholders. • Easily measure individual,
department and office contributions
• Keep the right people within an organization – accurately, clearly and objectively.
kept up-to-date with business KPI
performance. • Translate vision and strategy.
• Intuitive snapshot of performance against • Highlight organizational weakness
goals. and set KPIs to improve
performance.
• Collate all KPI data conveniently in one place
– no need for over complex, unreliable • A single concise management tool
spread sheets for operational performance.
• Supports multi-site / locations / departments • Gain a competitive advantage.
for a view of the whole organization.
• Transparency of performance at all levels.

MISSION, VISION, OBJECTIVES
AND KPI

MISSION AND VISION
Mission and vision both relate to an organization’s purpose and are

typically communicated in some written form. Mission and vision
are statements from the organization that answer questions about
who we are, what do we value, and where we’re going.

GOALS AND OBJECTIVES
Goals and objectives are often defined and used differently
within different companies or parts of a business and this
can lead to problems when creating processes to track and
improve marketing performance.
Vision > Goals > Objectives > KPIs > Measures
Long-term Vision > Broad organizational goals >

Specific SMART objectives > Performance driving
KPIs
Translating business goals to specific objectives and KPIs
• Be clear on the difference between goals, objectives and KPIs. ...

• Ensure your targets are SMART (it doesn't work otherwise) ...
• Select your metrics for KPIs carefully. ...
• Name them practically. ...
• Build process around checking in against KPIs. ...
• Ensure a plan of actions relates to the KPIs.

Example for Defining objectives
and goals
For example: For digital marketing you can define different types of performance measure as follows:
• Marketing goals are Top-level broad goals to show how the business can benefit from digital
channels. So, goals are the broad aims used to shape your digital strategy. They describe how your
digital marketing will contribute to the business in key areas of growing sales, communicating with
your audience and saving money.
• Marketing objectives. Specific SMART objectives to give clear direction and commercial targets.
Objectives are the SMART targets for digital marketing which can be used to track performance
against target.
• Marketing KPIs. Key performance indicators (KPIs) are used to check you are on track.) KPIs are
specific metrics which are used to track performance to make sure you are on track to meet specific
objectives. They are sometimes known as performance drivers or critical success factors for this
reason.

How to define a KPI
The operative word in KPI is “key” because every
KPI should related to a specific business outcome
with a performance measure.

steps to define Your KPI:
• What is your desired outcome?
• Why does this outcome matter?
• How are you going to measure progress?
• How can you influence the outcome?
• Who is responsible for the business outcome?
• How will you know you’ve achieved your outcome?
• How often will you review progress towards the outcome?
Example :
your objective is to increase sales revenue this year. You’re going to call this your Sales
Growth KPI. Here’s how you might define the KPI:
• To increase sales revenue by 20% this year
• Achieving this target will allow the business to become profitable
• Progress will be measured as an increase in revenue measured in dollars spent
• By hiring additional sales staff, by promoting existing customers to buy more product
• The Chief Sales Officer is responsible for this metric
• Revenue will have increased by 20% this year
• Will be reviewed on a monthly basis

OUR KPI
A Quick exercise

FINANCE
No Key result KPI Weight of Target Actual Score Final
area KPI Score
1 Profitability Profit to sales
Ratio
2
3
4

No Key result KPI Weight of Target Actual Score Final Score
area KPI
1
2
3
4

HR
N Key result area KPI Weight of Target Actual Score Final Score
o KPI
1 Recruitment Average lead time

to recruit
2
3
4

LOGISTIC
o KPI
1
2
3
4

SUPPLY CHAIN
o KPI
1 Frieght Freight cost per

unit
2
3
4

OPERATION
o KPI
1
2
3
4

CHARACTERSITICS OF A
GOOD KPI

Characteristics of Effective KPIs
A Key Performance Indicator (KPI) is a
measurement of performance related to a specific
objective or goal. Typically, KPIs can be thought of
in two categories: Drivers, which measure current
and future activity, and Outcomes, which measure
output of past activity. Both types are important to
Visible
Simple
Measurable
Timely
successful performance measurement and in Actionable
: .
making informed decisions when applied to
Business Intelligence.
Remember that not all measurements are KPIs. It’s
important to determine which measurements in
your business are indicators of true performance.
Paying close attention to those measurements,
your KPIs, can help identify areas of success and
areas for improvement
TYPES OF KPIs
Operati
Financia Growth Custom
onal
l KPIs KPIs er KPIs
KPIs

The specific KPIs that you need to measure can differ greatly from
industry to industry, but when it comes down to it, they are all tracked
to aid in accomplishing the same goal: increasing your profit margin.
Furthermore, most KPIs fall into one of the following four categories:
• Revenue improvement
• Cost reduction
• Process cycle-time improvement
• Increased customer satisfaction

Financial KPIs
Financial performance is a subjective measure of how well a firm can use assets from its
primary mode of business and generate revenues. This term is also used as a general
measure of a firm's overall financial health over a given period of time, and can be used to
compare similar firms across the same industry or to compare industries or sectors in
aggregation.
Gross Profit Margin. Your gross profit margin tells you whether you are pricing your goods
or services appropriately. ...
• Net Profit. This is where the rubber hits the road. ...
• Net Profit Margin. Net profit margin tells you what percentage of your revenue was
profit. ...
• Aging Accounts Receivable. ...
• Current Ratio.
Operations KPIs
• Order Fulfillment Time
• Time to Market
• Employee Satisfaction Rating
• Employee Churn Rate

Marketing KPIs
• Monthly Website Traffic
• Number of Qualified Leads
• Conversion Rate for Call-To-Action Content
• Keywords in Top 10 Search Engine Results
• Blog Articles Published This Month
• E-Books Published This Month

Growth KPIs
• Market
• Customers
• Finance
• Operations
• Growth Hypothese

Customer KPIs
• Number of Customers Retained

• Percentage of Market Share
• Net Promotor Score
• Average Ticket/Support Resolution Time

Service Quality – Key
Performance Indicators
• Cycle time from request to delivery
• Call length – the time to answer a call
• Volume of calls handled – per call centre staff
• Number of escalations how many bad
• Number of reminders – how many at risk
• Number of alerts – overall summary
• Customer ratings of service – customer satisfaction
• Number of customer complaints – problems
• Number of late tasks – late
Efficiency – Key Performance
Indicators
• Cycle time from request to delivery
• Average cycle time from request to delivery
• Call length
• Volume of tasks per staff
• Number of staff involved
• Number of reminders
• Number of alerts
• Customer ratings of service
• Number of customer complaints
• Number of process errors
• Number of human errors
• Time allocated for administration, management, training

Compliance – Key Performance Indicators
• Average time lag between identification of external

compliance issues and resolution
• Frequency (in days) of compliance reviews

THE KPI CASCADE PROCESS
These relationships between KPIs make it possible for everyone to see how they
contribute to the organization in the best possible way to excel at what it exists
to do.
One of the most important keys to successfully aligning KPIs and performance
measures to strategy is make sure your strategy is measurable in the first place!
In particular, look out for:
• weasel words (like efficient or effective or quality or outcome) – they don’t
have clear enough meaning
• action-oriented goals that fail to articulate the intended performance results
• what exactly you are trying to measure (people versus process)
Step 1: Choose the model of cascading
that suits your organisation.
Cascading KPIs is the process of setting the right KPIs for business units and teams to measure, that are
relevant to the strategy and purpose of the organisation. We don’t want to measure what’s easy or obvious or
traditional. We want to measure what helps us make the decisions relevant now.
We don’t really cascade KPIs or performance measures. We cascade strategy, or the goals that comprise it.
And then, using a deliberate measure design technique, we establish KPIs for each goal at each level of the
cascaded strategy. This means our KPIs will automatically be aligned to strategy, and cascaded to the right
parts of the organisation.
There are two ways to cascade strategy. One method is to cascade through the functional structure of our
organisation. The other method is to cascade through the business process flows of our organisation. Neither
one is right or wrong, but the business process method makes the most sense to me, and makes it easier for
us to find the fundamental performance improvements that last.
Many people have trouble cascading strategy into support functions, like Finance, Procurement, or HR. But it
becomes much easier when see that these support functions don’t always directly link up to the organisation’s
corporate goals. But support functions can link directly to the goals of their internal customer business units.

Step 2: Consider relationships between
KPIs beyond cause-and-effect.
Most often, people assume that the cause-effect relationships between KPIs matter most. Sure, they’re useful for
helping diagnose a KPI’s trend by looking at its cause KPIs. And we can use current trends of KPIs to predict future
performance in their effect KPIs. For example, we can use this method to find
the right improvement initiatives for a lag measure.
But there is more to KPI relationships than cause-effect. There are
three types of performance measure or KPI relationships that are important:
• cause-effect: when one measure improves or deteriorates in performance, it causes another measure to improve or
deteriorate in performance as a consequence
• companion: each measure tells a part of a complete story of performance, so if we relied on just one of the measures,
we wouldn’t have a full enough picture to take the best action
• conflict: improving one measure causes another measure to deteriorate, so we need to consciously balance the trade
off
We need to figure out which relationship type exists between the KPIs we are aligning and cascading. But without
falling into the trap of making everything relate to everything! We need to focus on the strongest relationships that
will influence our decision making.

Step 3: Create a visual model of how KPIs relate
to goals, at each level in the organisation.
A visual model for mapping how KPIs or performance measures align to goals is the easiest and
fastest way to engage people. Lists and pyramids and flow charts don’t work as well as something like
the PuMP Results Map (more about PuMP here). Neither do the disjointed tiers of Strategy Maps that
can get confusing and repetitive. A Results Map puts it all on a single diagram. That diagram shows
the levels of KPIs, attached to the goals we have cascaded from top to bottom. So our KPIs are then
directly aligned to their relevant goals.
The PuMP Results Map is also a brilliant layout to help us make sense of the
different types of KPIs or performance measures that matter. There are lead and lag measures. There
are input and output measures. There are strategic and operational measures. There are endless
frameworks or classifications that consultants have published for KPIs. But few of them help us. They
aren’t comprehensive ways to classify our KPIs, and lead us to confusion.
But with the Results Map, we can see that it doesn’t matter so much which classification bucket we
put our KPIs into. What matters more is how they link to the results that matter most to us, and how
they link to one another.

Step 4: Help everyone see how their
work aligns to the KPIs and goals.
It can be tempting to try and directly cascade strategy to individual employees
in single leap from corporate to personal goals. But that doesn’t work. We can’t
get meaningful alignment of KPIs by giving everyone a “mini me” copy of the
corporate goals. It is a leap that’s simply too far and disconnected. And it causes
people to become disengaged, or make up trivial or illogical links between their
work and the corporate direction.
To align individuals to the corporate goals, we need to do is build a clearly
cascaded model of goals through the natural layers of the organisation’s
structure. And then it provides a clear “line of sight” to individuals to see their
own local goals. Their local goals will be relevant to them, within their circle of
influence, and still aligned to what is corporately important.

Step 5: Use the KPI alignment to improve
performance with more leverage.
Improving each individual KPI, on its own, seems like a natural way to use KPIs for
performance improvement. But this tick-and-flick method of using KPIs in isolation too
often leads us to suboptimise each area of performance, like applying a quick fix to reduce
cycle time without seeing that the real problem is too much rework. Or we sabotage other
areas of performance, like minimising costs at the expense of quality. That’s because of the
relationships that measures or KPIs have to one another (see Step 2 above).
True performance improvement isn’t in the KPIs, it’s in the spaces between them. This is
why the relationships between and among our KPIs are so important. So we need to use
our KPIs as a suite or collection of information. We need to understand the full story of a
particular domain of performance, like a strategic theme or a business process, or a
functional area. Sometimes we also need to dive below the surface of our KPIs, to get a
fuller story from the data.

How to Manage KPI

Managing key performance indicators lets you evaluate how
well your business is doing and where its performance could
improve. You select a KPI because it gives you objective
feedback on the effectiveness of management strategy in a
particular area. To evaluate overall performance, you need
KPIs from each of your areas of operation. A small
enterprise seeking to grow its business can manage its KPIs
to improve performance and grow the business.
Selection Evaluatio Manage

Target
. n ment

1. Selection
• To choose a KPI, you have to find a variable closely linked
to your business goals and one that you can measure
reliably. Working backward from objectives through
activities that further them to measuring the results of
these activities, you can arrive at one or more variables
that are keys to success. The best indicators are those
that vary with the effectiveness of your goal-related
activities and react quickly to any changes. For example, if
your objective is to increase sales, the associated activity
is marketing
Developing and aAhmed
Key Performance Indicators-Aiman relevant
Ibrahim KPI is the percentage change
in new sales.
2. Targets
• When you evaluate a KPI, you have to be able to compare its value to
a target to determine whether performance is adequate. Targets can
be internal or they can result from industry surveys to compare your
company's performance to others in your industry. If your KPI
measures an internal metric such as production costs, you can use
historical data to determine targets while, for industry variables such
as warranty calls or customer complaints, targets based on industry-
wide figures are useful. For example, a small manufacturer whose
KPI indicates he has more warranty claims than the industry average
might identify a source of defects in his products and correct it.
3. Evaluation
• To evaluate a KPI reliably it must be specific in that it gives the result of
one particular activity. Measurment of the KPI must be objective,
meaning that anyone who applies the same measurement gets the same
result. The measurement must give you a relevant variable that means
something important to your business. The measured result must be
available quickly, giving you time to react and make corresponding
changes. For example, a pizza parlor KPI for speed of service might
measure the percentage of pizzas served within a given time from order
placement. When your KPI has the required characteristics, your
evaluation gives you the basis for actions that further your goals.

4. Management
• Once you have several KPIs from different areas of the
company, you can make changes and see how the KPIs
respond. Managing them in this way lets you fine-tune
your operations. You act in areas where your KPIs are
below the benchmarks and evaluate them to see what
effect your actions have had. For example, a pizza parlor
can track the effect of changes in preparation on speed of
service. Since your KPIs react quickly and are relevant to
your business, you can try out different changes and
proceed
Developing with
Key Performance those
Indicators-Aiman that
Ahmed Ibrahim have the most positive outcome.
How to Monitor Your KPIs???
• Of course, setting KPIs is a
pointless activity unless you
actively monitor them on a regular
basis and take action as soon as
you see a problem.
“How often should I track KPIs?”
The answer is: “As often as possible.”

What Is A KPI Report?
• This is simply a “strategic tracking • Additionally, you have to track an
method” that will help your organization adequate amount of information to
better define and track the numbers you
want to hit. Let’s say, for example, that
make the KPI effective. If you
your company wants to track “Sales By simply state that you want to track
Region,” (which happens to be one of 18 Sales By Region, but then don’t
very important KPIs to track)—you’d need assign an owner, don’t analyze
to know what it includes, what it doesn’t regional sales objectives, and don’t
include, who is in charge of making sure
the information is correct, and more. If
present the findings on a regular
you don’t have all this information basis, you shouldn’t count on
organized, you’d be fighting an uphill reaching your goals anytime soon.
battle.

HOW TO PRESENT YOUR
KPIS
A good KPI report should be easily accessible,
interactive and transformable in under 10 minutes.

How to present KPIs
Common ways to present KPIs to managers and executives:
• Share an email report with KPIs
• Distribute a PDF that shows KPIs
• Present KPIs using a slide presentation
• Display KPIs on a TV dashboard
• Visualize KPIs using a KPI dashboard
• Share KPIs using mobile reports or dashboards
• Build your own KPIs using dashboard software.
Summary-Level KPI
Report Examples

1. Matrix View
• This matrix view shows all your measures in the far left column, followed
by frequency reporting, status, monthly updates, and RAG status. This
summary view works best for financial personnel or others who are
number-oriented.
2. Dashboard View
• if you want to look at charts on how your KPIs are performing, a dashboard of your current metrics
is helpful. For example, the above chart shows three different views of revenue for Upward Airlines
(the hypothetical company named in the chart), which could be helpful in a board-level meeting.

3. Red Alert View
• This view highlights all “red” or critical measures, including who owns them, the context behind them, and when they
were last updated. This is a great tool for team accountability, so you can determine who’s responsible for these metrics,
whether they’re providing updates and helping the metric along, etc.
• Keep in mind: It’s important to have the right balance of information in your summary-level KPI reports. There’s a time
and place for long reports, but most people won’t review them thoroughly. So these summary-level reports highlight the
things everyone really wants to see—and if you’re using software, readers can drill down to the detail at the right time.

1. Matrix View
number-oriented.
1. Matrix View
number-oriented.
Detail-Level KPI Report Example
Instead of simply describing what a

good key performance indicator
template should look like, I think it’s
better to show you. So here are two
KPI examples (designated below as
“measures”)—“Percent of key
positions filled with qualified
individuals,” and “Number of
engagements in conjunction or
coordinated with international
partners.” Let’s walk through each
category, step by step, so you can
create a similar template for yourself.
For the sake of the descriptions
below, let’s look at the far right-hand
• Objective: An objective, as previously stated, is a high-level company goal. The reason you’re tracking a KPI in the first place is to
ensure that this particular goal is met. It should be stated in your KPI report so you keep in mind why you’re tracking a particular
KPI or what you’re trying to improve in regard to your strategy. So one of the objectives listed here is, “Lead future global
cooperation.”
• Measure: You can think of a “measure” and a “KPI” as one and the same. The KPI in our example—“number of engagements in
conjunction or coordinated with international partners”—is how this hypothetical company plans on “leading future global
cooperation.” Remember, this step needs to be actionable, crucial, and easily communicated across the organization.
• Rationale/Definition: This section should explain the why factor. When a KPI that lines up with a particular objective has been
decided upon, the team assigned and the KPI owner should be able to describe (in detail) why they made the choice they did. In our
example, the team chose to measure the number of engagements in conjunction or coordination with international partners
because they felt strongly that they should “work jointly with international partners to demonstrate capability and maintain
influence to continue to lead in the future.”
• Frequency: How often (so, at what frequency) should the KPI be measured? In our example, the owner and team decided it should
be re-examined on an annual basis. Other KPIs could be measured monthly, quarterly, or bi-annually, depending on the type and the
importance.
• Source/Formula: This section provides insight on where you can find the data source that is used to monitor and measure this KPI.
In our example, that information can be found at the international affairs office. There is no formula that needs to be applied to the
data source involved in this example, but if there was, it would appear in this section as well.
• Graph: With every KPI, you have to determine how you’re going to share the information that you collect. For example, is it more
important to see target, actual or your year-to-date performance, or a benchmark? Decide what is most valuable and create a
meaningful chart with that information. Make sure you’re consistent and use the same chart each month, quarter, or year, so the
team can track performance over time. Our example has been measured by the “number of engagements with international
partners” measured each fiscal year.
• Owner Comments: To be successful, every KPI needs an “owner” who is tasked with tracking it. In this section, the owner can
leave comments about any additionally qualitative information they need. Here, the owner noted that they need to further leverage
their partnership with the State Department for better KPI results.

KPI check list
Review these questions as a checklist when
building out your key business performance
measurement systems

• Be derived from strategy • Be consistent (in that they maintain their
significance as time goes by)
• Be simple to understand
• Provide fast feedback
• Provide timely and accurate feedback
• Have an explicit purpose
• Be based on quantities that can be
• Be based on an explicitly defined formula
influenced, or controlled, by the user
and source of data
alone or in co-operation with others
• Employ ratios rather than absolute
• Reflect the “business process” – i.e. numbers
both the supplier and customer should
• Use data which are automatically
be involved in the definition of the
collected as part of a process whenever
measure possible
• Relate to specific goals (targets) • Be reported in a simple consistent format
• Be relevant • Be based on trends rather than snapshots
• Be part of a closed management loop • Provide information
• Be clearly defined • Be precise – be exact about what is being
measured
• Have visual impact
• Be objective – not based on opinion
• Focus on improvement

SUMMARY
• KPIs are used to Measure your performance against
key business objectives.
• KPIs are an effective tool to help build better performing
teams.
• SMART KPIs are Specific, Measurable, Attainable,
Relevant, Time-bound

• In this course, you’ve learned what KPIs are and how they can help your
business. You’ve seen some examples of different types of KPIs, and you’ve
learned how to set effective KPIs. Finally, you’ve learned how to monitor
your KPIs regularly and how to refine them to ensure they stay relevant.
• So you’re now ready to set KPIs for your own business. Use the process
we’ve covered today, make sure that you’re only tracking what’s really
important, and then make sure you track it as often as possible and update
the KPIs whenever you need to. If you do all that, you should be well on
your way to joining that minority of small businesses that successfully
achieve all their targets.


Key Performance Indicators (KPIs) October 18

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Key Performance Indicators (KPIs) October 18

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DEVELOPING KEY

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

• Identify areas of activity that require greater

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

• Do the KPIs provide YOU with a clear indication of progress

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Mission and vision both relate to an organization’s purpose and are

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Long-term Vision > Broad organizational goals >

• Be clear on the difference between goals, objectives and KPIs. ...

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

1 Recruitment Average lead time

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

1 Frieght Freight cost per

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

• Number of Customers Retained

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

• Average time lag between identification of external

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Selection Evaluatio Manage

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Instead of simply describing what a

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim

Developing Key Performance Indicators-Aiman Ahmed Ibrahim