The Ultimate KPI Guide

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    What does KPI mean?

    KPI stands for 'Key Performance Indictor'.

    What is a KPI?

    A KPI is a performance measure (someties refered to as a 'metric') quantifying something that we care about or is important in some way. Head here for a 60 second explanation of KPIs using kittens.

    What is the difference between a KPI, PI, metric and performance measure?

    Metric, measure and indicator are three different ways of describing the same thing, 'something we measure'.

    Deciding whether a Performance Indicator is, or is not, a KPI creates huge amounts of debate and strong opinions. This debate will never be settled because the importance of a measure depends on the situation it is being used in, so there can never be a definitive list of 'what is a PI and what is a KPI'.

    How do we separate KPIs from PIs?

    With no centralised list of what makes a measure 'Key' or not, it comes down to which measures are important to us, our organisation or our specific situation. We must rank our measures relative to each other, with the highest ranking measures earning the title 'KPI'. This can be managed formally using the 'Shortlisting' step from the ROKS method.



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    The seven principles of good KPI design and definition

    Before we dive into the best method for choosing and defining our KPIs let's take a look at the principles those methods are based on...

    That sounds like a lot to remember

    If this all seems a bit overwhelming, don't worry. We have not one, but two KPI definition methods you can use that are built around these principles. Here's why we need two methods...

    cartoon of man standing by blackboard puzzling how to solve a maths problem

    The nature and complexity of your organisation has a big impact on the way in which you choose your KPIs. Here's a quick guide to help you choose the right approach...

    KPI definition for small and medium sizes organisations

    KPIs definition for large, complex or mission-based organisations

    Still not sure which approach to use?

    The ROKS Express method has been built using the tools of the ROKS Enterprise method, so if you aren't sure, start with the ROKS Express approach, you can always extend it later with the Enterprise approach.

    How to define KPIs for smaller businesses

    ROKS Express KPI Definition Method Logo

    ROKS Express:. The perfect solution for small-medium sized commercial organisations looking to kickstart their growth. Using a simple questionnaire, this system will help you get up and running with your core KPIs in hours, not weeks.

    Show me the ROKS Express method!

    ROKS Express KPI definition process overview

    ROKS Express complete process

    ROKS Express: Each step in detail

    Step 1: Goals check

    Knowing what you want to achieve is THE critical foundation of any well designed KPI set. Think of it as 'deciding what DIY task you want to complete before you go to the DIY superstore'.  You would have a much better idea of which tools and materials to buy if you put some thought in at the start.

    ROKS Express Step 1 - Goals check
    • Think hard about what you want from your business and from life.
    • Create your ‘First-Draft Objectives’ and identify your ‘Key Results’.
    • State what result achieving each of the objectives will deliver and record as an ‘Objective Key Result’ - OKR.
    • Double-check that your objectives and high-level targets are ready-to-go using the ‘Pre-flight objectives checklist’.

    Step 2: Draft the 'Ready to go' list of KPIs

    Many businesses share common characteristics. We call these 'traits' and combined they can rapidly build up a full description of the families of KPIs we need for our business. Here is a sample of some of these 'traits'...

    ROKS Express Step 2 - Draft list of 'ready to go' KPIs
    • Staff and payroll
    • Equipment investment
    • Footfall
    • Sensitive customer data stored
    • Sales value, activity and results
    • Stock

    There are 52 traits in total, which when combined, can describe the vast majority of 'normal' organisations. Larger or mission-focussed organisations may not have full coverage from these traits (they need the ROKS Enterprise method)

    In this step we...

    1. Identify the ‘business traits’ that apply to your business, using a simple survey tool.
    2. Use the survey to select the KPI Families you need to review.
    3. Review the relevant KPI Families to select your KPI Longlist, ready for trimming down to the essentials in Step 3.

    Here's a full list of the those traits (the page numbers are from Getting started with KPIs, the definitive source for all things ROKS Express related.


    All 413 pre-defined KPIs, with worked examples, are included in...

    KPI Bootcamp on-demand course

    Step 2 is a great way to come up with a draft list of KPIs, but the list will be far too long. The next stage is to take that list of KPIs and cut it down to a much shorter list that will be practical to implement. We do this using 'Sifting questions' followed by a scoring process called 'Shortlisting'.

    Step 3: Shortlist KPIs

    ROKS Express Step 3 - Shortlist KPIs

    Rapidly reduce the KPI Longlist by asking the ‘Sifting questions’.

    • Use the KPI Shortlisting Template to score each candidate KPI for Importance and Ease of Measurement.
    • Shortlist your KPIs by scoring rank, deciding on your cut-off threshold and any exceptions that you may want to make.

    Step 4: Tune KPI definitions

    Once we have a shortlist of KPIs, we need to make sure these KPIs are clearly 'explained' using a structured definition template and we need to decide on targets for those KPIs.

    Why do we need KPI definitions?

    Human language is designed to tell stories. It does this through a rich selection of words. Many of these words overlap. Sometimes the same word can paint completely different pictures in people’s minds.

    The human mind also has a fantastic ability to fill in gaps and blanks using our imagination. This ability is one reason so many people prefer the written version of a story over the film; their minds seamlessly fill in the missing details.

    Now if you are a novelist, this effect is fantastic. A few well-chosen words can set off a fireworks display of imagination in the reader. If you are trying to measure something, it’s a potential disaster. We need to be precise and clear in how to calculate a metric or KPI.

    ROKS Express Step 4 - Tune KPI definitions

    Here's what we need to do...

    • Clearly and simply tailor the definitions of the Shortlisted KPIs to your specific organisation and record other useful information, such as where the data is stored, what the known problems with the KPI are and who the owners of the KPI and definition are.
    • You may also decide to create KPI Cheat Sheets, as a training aid or support tool for your team.
    • Think carefully about the targets you set, the behaviours they might drive and whether you can make your targets more engaging.
    • Reach agreement with those the targets will affect.

    Step 5: Dashboard and report build

    Now that you have designed your individual KPIs you need some way of presenting them for review and decision-making. The normal way of presenting KPIs is using a dashboard (quick summary overview of the situation) or through reports (normally a more in-depth view of a situation).

    Dashboards and reports come in all sorts of styles and complexities. They range from a simple print-out of some figures on a spreadsheet through to sophisticated ‘infographics’.

    ROKS Express Step 5 - Dashboard and report build

    In the dashboard and report build step you...

    • Decide how and when you will review your KPIs
    • Decide how you will present and review your KPIs
    • Understand the simple rules of clear report and dashboard design
    • Its also recommended that you learn some tips and tricks for designing and customising Excel reports and dashboards if you are using Excel

    Designing clear easy-to-read dashboards and reports should not be guesswork.  There are clear principles of visual design, which will make dashboards quick and intuitive to understand if you follow them, or cluttered and confusing you break them. These rules are based on careful academic research by the likes of Edward Tufte, Stephen Few and many others.

    Step 6: Go live

    ROKS Express Step 6 - Go live

    All your hard work so far will be for nothing, if you don't roll out your new KPIs, reports and dashboards. Roll-out doesn't just include developing a plan, we also need to think about the practicalities and problems we are likely to face. It's crucial to...

    • Plan your KPI rollout carefully
    • Start collecting data
    • Put your KPIs into action
    • Deal with the inevitable hiccups and implementation problems

    Why you need a KPI implementation plan

    KPIs are like New Year fitness resolutions. Many of us start off with strong resolve, but quickly get sidetracked by everyday life. Breaking down the KPI rollout process into basic steps can help you stay on track and stop you being overwhelmed.

    Taking this further...

    How to define KPIs for large or complex organisations

    ROKS Enterprise KPI Definition Method Logo

    ROKS Enterprise: for large, complex or mission-based organisations. This approach is based on KPI Trees, an incredibly powerful and flexible, visual KPI selection method. This is the right choice for organisations that can dedicates time and resource to KPI design and definition.

    Show me the ROKS Enterprise method!

    What is the ROKS method?

    Building KPIs is hard and has lots of hidden traps. That's why we developed a bullet-proof seven-step method for larger organisations to develop the right selection of KPIs to achieve their business goals. This method is called the ROKS Enterprise™ approach. ROKS stands for Results-Orientated KPI System. This site is packed with free resources on the ROKS Enterprise™ method and this page is designed to help you navigate the resources in a logical way, bookmark it now!

    The content links are grouped by ROKS approach step. Here you go, and don't be shy about getting in touch using the contact form...

    Who is the ROKS Enterprise™ approach designed for?

    Medium to large enterprises that want to use their strategic objectives to develop a focussed, effective set of performance indicators. It can also be useful for smaller organisations with complex or unusual needs.

    ROKS Enterprise KPI definition process overview

    ROKS Enterprise complete process

    ROKS Enterprise: Each step in detail

    Step 1: Clear Strategy

    Not having a clear business strategy (or worse still, having a strategy that is woolly or vague) will completely undermine all your work on KPIs. The good news is that there are some checks you can run to see if your strategy is fit for creating meaningful KPIs.

    ROKS Enterprise Step 1 icon

    Agree what you are trying to achieve

    • Review strategy documentation
    • Identify strategic objectives
    • Where and how will your KPIs be used?

    Article: Setting objectives using the OKR approach - Insider Tips from an OKRs Coach

    Premium: KPI Checklists - Chapter: 'Step 1 - Clear Strategy'

    Step 2: Engage

    Experience taught me the hard way, if you don't have the right people in the room when you develop and agree your KPIs, you might as well have not bothered - you will have to do it all over again. This step is all about identifying the right people to involve at the start, how to involve them and keeping track of that involvement.

    ROKS Enterprise Step 2 icon

    Engage stakeholders and assess situation

    • Identify key stakeholders
    • Develop communications plan
    • Cognitive design training
    • Review existing reports and dashboards

    Template: RACI Template for identifying stakeholders

    Premium: KPI Checklists - Chapter: 'Step 2- Engage'

    Step 3: Longlist your KPIs with KPI Trees

    People tend to want jump straight to the 'right answer' and may miss many critical KPIs by doing this. The ROKS method separates KPI selection into two stages. The first stage 'longlisting', using KPI Trees, builds a full model of all the potential KPIs, without worrying about how important or practical those measures are. This list will be waaaay too long, but don't worry, we have a structured way of reducing this list in Step 4.

    ROKS Enterprise Step 3 icon

    KPI Trees to create 'longlist'

    • Draft 'KPI Trees' in stakeholder workshops
    • Run follow-up results mapping workshop
    • Redraft, review and sign off KPI Trees

    Article: Find the right software to draw your KPI Trees - Tree Diagram Tools: Tips and App Reviews

    Video: Hard-to-measure things... How to Measure Just About Anything

    Premium: KPI Checklists - Chapter: 'Step 3- Longlist KPIs'

    Step 4: Shortlist KPIs

    It's really easy to get 'carried away' and to try to measure too many things. This shortlisting step offers a bullet-proof way to reduce that list to a manageable size. It also documents the 'why' for which KPIs we selected and which we chose to leave or implement at a later stage.

    ROKS Enterprise Step 4 icon

    Premium: KPI Checklists - Chapter: 'Step 4- Shortlist KPIs'

    Practical guide: How to shortlist your KPIs - Too Many KPIs or Measures?

    Develop the measures 'shortlist'

    • Workshop importance/ease-of-capture matrix
    • Agree 'use, aspire or discard' list
    • Set up new measures
    • Develop action plans for 'use' and 'aspire' lists

    Step 5: Define

    Definition is all about writing down some vital information about your shortlisted KPIs, such as which data is used, precise calculations, what is or is not in included in the data etc. Honestly, most organisations will do almost anything to avoid doing this step. If you skip the KPI definition step bad things will happen. The tools provided here will help you think about, and record, all the important aspects of defining your shortlisted KPIs in a clear, logical and readable way.

    ROKS Enterprise Step 5 icon

    Define KPIs

    • Precisely define measures and KPIs
    • Document known issues
    • Make definitions and notes freely available

    Article: Hazards of poor KPI definition - Defining KPIs: How the wrong KPI shut schools

    Template: ROKS KPI Canvas for KPI Definition - A lighter, more visual, approach to KPI definition and sharing of definitions. My preferred template until the RACI definitions are crucial to you.

    Template: KPI Cheat Sheet - A great way to share definitions and build up a 'hands-on' reference document.

    Premium: Essential KPI Guides - ready defined KPIs, grouped into 17 popular topics, to give you a flying start on your definitions.

    Premium: KPI Checklists - Chapter: 'Step 5 - Define'

    Step 6: Prototype

    Fully working dashboards and reports can take lots of time, money and effort to implement. Managers often change their minds when they see new reports or dashboards, upsetting their analysts and wasting huge amounts of time and effort. You can avoid this trap by creating 'mockups' your reports, getting sign-off on fully reviewed prototypes and then building the working versions.

    ROKS Enterprise Step 6 icon

    Design and test your dashboards and reports

    • Review the prototype proposals
    • Run dashboard live prototyping sessions
    • Review and revise draft dashboard/report
    • Approval

    Checklist: Assessing your new, or pre-exiting reports and dashboards - Assessing Report Design Objectively – Avoiding Fights

    Premium: The Brilliant Excel Dashboards Manual (£1 offer)

    Premium: The Brilliant Excel Dashboards Kit. Includes powerful dashboard templates, walkthrough videos, sample dashboards and more.

    Step 7: Go Live

    The best designed KPIs and reports are meaningless until they are part of every-day life in their organisation. Rolling out KPIs involves fixing lots of problems and people. Fortunately many of the issues have been solved in other organisations before, and many of those tools and strategies are outlined in this step. Typical challenges involve slow KPI production process, reporting tool selection,  lack of trust in data quality, sustainability and many other factors.

    ROKS Enterprise Step 7 icon

    Roll out your KPIs, reports and dashboards

    • Get buy-in
    • Deal with issues with existing data
    • Map the KPI process
    • Seek user feedback and tweaks during nursery period
    • Hand over to 'business as usual' team

    Rollout engagement

    Checklist: Getting KPI Buy-In

    Article: Building report engagement - Report Engagement, 10 essential lessons from spam email

    Dealing with problems

    Article: Spotting problems with your KPI data quality Accurate KPIs, Van Halen and brown sweets

    Article: Dealing with reporting production problems - Painful report production? Why you should be worried…

    Tools and techniques

    Template: Action Tracking - Not just for KPI implementation, a handy template to keep track of actions, status and ownership.

    Premium: KPI Checklists - Chapter: 'Step 7 - Go Live'

    More useful material

    Article: If you are stuck, or have trouble getting started, with your KPIs How to get started with KPIs, even if you have been putting it off for years

    Find out more


    The original guide to the ROKS Enterprise method is KPI Checklists. It's available in paperback, Kindle and ePub format from Amazon and most major online book sellers.

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