How to select the right Key Performance Indicators

In these days I’m working on how Information Architecture is designed for the Dashboard/Scorecards solutions – what information artefacts are used and how they are organized. While skimmed different resources on this topic I found one interesting statement by David Parmenter, in his book “Key Performance Indicators:Developing,Implementing,and Using Winning KPIs” that I reckon is worth to share

David uses 12 steps for identifying the artefacts that are used as Key Performance Indicators (KPI) for Scorecard/Dashboard. Process covers major success BUSINESS DRIVEN factors, such as stakeholder buy-in, organic growth, and iteration instead of “get it right the first time.”

1. Senior management team commitment
2. Establishing a “winning KPI” project team
3. Establishing a “just do it” culture and process
4. Setting up a holistic KPI development strategy
5. Marketing a KPI system to all employees
6. Identifying organization-wide critical success factors
7. Recording performance measures in a database
8. Selecting team-level performance measures
9. Selecting organizational winning KPIs
10. Developing the reporting frameworks at all levels
11. Facilitating the use of winning KPIs
12. Refining KPIs to maintain their relevance

The most common mistake when people select the irrelevant KPIs that don’t following the strategy maps. Strategy maps are designed to link a company’s high-level goals to the KPIs that measure how the company is performing on the measures that drive the business. In case of KPI not matching the business you are tracking the irrelevant stuff

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