Simply put, KPIs are performance metrics put in place to assess how well an activity is conducted. They provide a basis of comparison, like expected vs actual target. Without KPIs, one may not be able to accurately score an assigned charge. Without KPIs, the one who takes on the role/responsibility, does so without fully understanding the timelines involved, the scope of work to be done or even the financial consideration. Because there are distinct roles played by different members of a team, each person has his individual KPIs, based on his job description. Together everyone functions to deliver on the overall business objective(s).
Some pointers to bear in mind in developing KPIs
• KPIs are a form of communication, thus it should be relayed in a clear and concise manner to users.
• One size doesn't always fit all. KPIs should be tailored to a desired outcome. As organizations differ in their objectives, so also should their KPIs.
• KPIs should be developed bearing in mind, whose responsibility it is to deliver them.
• KPIs must follow the SMART principle for effectiveness
? Specific - What specific business objective does it aim to achieve ?
? Measurable - Can progress be measured towards the goal ?
? Attainable - How realistic are the goals in terms of being achieved ?
? Relevant - Are the goals relevant to the organization ? Or is it being copied and pasted ?
? Timely - What is the time-frame for achieving this goal ?
Conclusively, KPIs should be developed with evaluation and re-evaluation in mind. This allows for adjustments every now and then, to ensure relevance to the business.
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