Supply chain management resources


Kpi Start-up - Learn How To Design, Fill With Data And Use Key Performance Indicators

KPI term is for key performance indicators,office, but actually it is not true, as both
the KPI concept is about measuring andindicators depends on the regional
controlling business performance focusing oncharacteristics, such as the number of
the most important performance indicators.potential customers and the number of leads.
Does this concept works? How to make use ofWhen designing key performance indicators one
it?should consider factors to be connected with
root  indicator,  but  not  with  each other.
There might be a number of viewpoints on KPI,
and this concept can be used on various levelEven if you have a great KPI system, it will
of organization. For instance, CEO might usenot work, if the incoming data won't be
KPI to measure and control business, also,analyzed, sorted and represented correctly.
some managers can design and use KPI forIt's important to make sure that the person
their  department.who will be analyze and represent information
for KPI also involved in KPI design process
Does KPI approach work? Yes, in sense, itand know what is the goal of certain metrics
gives you a necessary information structuredand why it was used some metric and not the
and represented in a certain way, but howother  one.
good does it work? It depends on who have
designed your KPI, who is gathering data toWorking with well designed and prepared KPI
be inputted in KPI system, how do you analyzesystem is an easy task. But still one should
and  use  this  data.remember about limitation of KPI system. It
is not designed to show your business in
First, the most important is KPI design. Filldetails, also, it just represents someone's
the difference between indicators thatviewpoint on how the business processes
represent the total company profits pershould be organized. It is important to keep
month, company profits segmented by regionsKPI system up today, as what worked yesterday
and company profits segmented by region,will  not  show  anything  today.
customer education, customer social position.
It's obvious that these tree metrics are goodFinally, few words about tools that can help
for different views only, for instance, CEOto design KPI system. There are some
might be interested in total profit only,expensive business systems that allow to work
while regional manager need to know how otherwith KPI, but still these systems will not
regions  are  performing.help to design and keep updated KPI
indicators. So, before purchasing expensive
Other sample of bad indicators set is whensystem consider designing a test version
there are two indictors telling about theusing some spreadsheet software, such as
same thing from different viewpoints. ForExcel. Give KPI concept a try, find out if it
instance, it is bad idea to have "Profits byworks for your business and in what way.
region" indicator and "Support requests byHaving requirements list you will be able to
region". It seems that having two indicatorsget what you really need.
will show something about the regional



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