Design Your KPIs
The definition mistake that cost $328m
One team, two measurement systems On December 11th 1998 NASA launched the Mars Climate Orbiter. The probe was designed to measure water distribution on the surface of Mars. 286 days after launch the $328 million probe arrived at Mars. It missed the correct orbit by 100km. The probe dipped into the atmosphere, overheating the engine…
Process KPIs, the pain-free way
Some KPIs are obvious, but important… When it comes to choosing some KPIs, careful thought may be needed to align them with strategy (see this article on why you should use KPI Trees to do this). Other measures are in the ‘obvious but important’ camp. In process and production environments it’s fairly safe to say that we care about…
Choosing KPIs the right way
Choosing your KPIs the RIGHT way I used to be a bit of KPI purist. I would argue that you must build your KPI selection from ‘scratch’ as your KPIs must reflect your strategic objectives and you should never ‘borrow’ another organisation’s strategic objectives. Having spent a lot of time actually creating KPIs for organisations…
Accurate KPIs, Van Halen and brown sweets.
How do you know if you are looking at accurate KPIs, reports or dashboards? Perhaps we can learn a lesson from rock legends Van Halen. A copy of their 1982 tour rider makes for interesting reading. It’s 53 pages long and contains some very specific requirements, including: Two dozen English muffins Six bars of soap Six…
Why Finance should not own (all) your KPIs
A point to make is that KPIs are not just financial measures. Financial measures are crucial in many organisations, but they are also `lagging’ – which means they tell you what happened after the event. KPIs should also help you see what is coming, not just what has passed. It’s like the difference between a…
KPI Management – Using KPIs to improve your business
KPIs are the first step for improving or controlling a business. Measures are the eyes and ears of anyone who has to manage anything bigger than a one-man business. KPI management is all about using KPIs to give you a clear and honest view of whichever organisation you are looking at. I use two processes…
Putting the Key into Key Performance Indicators
How many “top level” KPIs do you have? If you have more than 10 top-level measures then you probably have too many. Building a measurement hierarchy (using a KPI Tree) can help show which ones are crucial. Remember to focus on the indicators that support your strategy. If you want to find out how to…
Guest Blog: The 12 Characteristics of Good Performance Measures
KPIs are critical for the success of any organisation. They are a measure of progress against goals. However, not every measure is a KPI. Put it in the words of Albeit Einstein,“Not everything that can be counted counts, and not everything that counts can be counted”. Good performance measures allow for comparisons to be made…
Smooth bottoms and dashboard design
Most people don’t look at the bottom of their laptop. If they do then they will see one of two things: If it’s a Apple Mac the bottom with be smooth and (with the latest ones) completely featureless apart from four rounded rubber feet. If it’s a PC it will have little hatches, a Microsoft…