Key Performance Indicators [KPI's]
Key Performance Indicators underpin the efficiency and effectiveness
of strategies and operations.
They form the basis of scorecards and dashboards to provide a meaningful
measure of performance in terms of operational activity, transactions
and financial performance.
KPI's are developed for every part of the business, and can form
the basis of both system and human performance evaluation. The two
key requirements of KPI's are:
- They are meaningful as they relate to both the operational performance
and in their contribution to supporting corporate strategy
- The are collectible without being intrusive to the efficient
performance of process tasks.
Commonly Used KPI's
Typical KPI's in each business area include:
Enterprise [Shareholder] KPI's
- Operating Cashflow
- Return on Capital Employed X Asset
- Operating Expense X Region X Business Unit
- Percentage Change Revenue X Target Account X Channel
- Percentage Total Revenue X Asset
Finance
- Days Outstanding X Customer X Quarter
- Actual vs Forecast Revenue
- Actual vs Forecast Expenses
- Percentage Change x Time Periods
Marketing
- Market Share
- Campaign Response Rate
- Cost of Customer Acquisition
- Average Revenue Per User [ARPU]
- Actual vs Forecast Sales
- Actual vs Forecast Profit X Product
Sales
- Quote To Sales Order Conversion Rate
- Percentage Quota Achieved X Salesperson
- Lost Deals X Time Period X Competitor
Supply & Distribution
- Purchase Order To Goods Receipt Cycle Time
- Sales Order To Delivery Cycle Time
- Inventory Turn Over
- Fulfilment Rate
- Percentage Discarded Material : Total Material [Wastage]
- Net Returns
- Backlog Quantity
Customer
- Customer Acquisitions
- Customer Attrition Rate
- Customer Retention Rate
- Customer Satisfaction Score
- Percentage Customer Complaints : Total Sales
HR
- Compensation Cost X Business Unit X Employee
- Employee Turn-Over [Attrition]
- Employee Retention Rate
The above KPI's are just a sample of the many KPI's that relate
to individual business functions and processes.
Next: Business
Process Management
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