Why are Key Performance Indicators important?
Measuring Key Performance Indicators is important to ensure the success of businesses. It ensures that all departments and teams are aligned in the same direction to achieve the set strategic goals. Here are a few reasons why Key Performance Indicators are important for organisational growth.
Monitor organisation’s health
KPIs are important to measure organisational success and failures. Get an overview of what is happening in your organisation and implement ways to improve overall performance. Make data-driven decisions.
Measure progress
Keeping track of Key Performance Indicators helps organisations track and monitor progress. It aligns teams’ performance with the long-term strategic goals of the organisation and determines whether you are moving in the right direction.
Stay on track
Key Performance Indicators will help organisations predict future trends. Keep teams on track by aligning strategic goals and plans with their performance. Focusing on the same goal helps in better strategy map execution.
Boost team performance
Create a culture of continuous improvement. Key Performance Indicators will help teams take the right steps to deliver high impact results. Identify pain points that hinder performance and implement actions to bridge the gaps.
Types of Key Performance Indicators
Key Performance Indicators are used at all levels in an organisation. While some KPIs are used to measure short-term goals, some focus on long-term goals. All these KPIs associated with short and long term goals finally ties together to the ultimate organisational strategic goals.
Strategic
These are the key performance indicators that monitor an organisation’s big-picture goals. Strategic KPIs tells how the organisation is progressing during a particular time. Examples of strategic KPIs are revenue per customer, gross value, return on investment (ROI) and market share.
Leading vs Lagging
Leading KPIs keeps an eye on changes and trends and help organisation or teams to manage the performance of various processes. Lagging KPIs shows us how well the system or process was managed. Organisations incorporate both types of KPIs to make. sure what they track is important.
Operational
These KPIs monitor and measure performance of a shorter time period. They focus on an organisation’s processes and their efficiencies. Operational KPIs enable businesses to derive meaningful conclusions on the outcomes. Lead-to-Opportunity Ratio, Delivery Time, Transportation Costs and Production Volume are some examples of Operational KPIs.
Configure and categorise KPIs to align with business objectives.
- Define KPI categories, unit types, intervals, and trend directions.
- Organise KPIs into structured groups like Safety, Quality, and People.
- Ensure flexibility with customised KPI settings for different departments.
Gain real-time insights with intuitive visual indicators.
- Use RAG (Red, Amber, Green) color coding for easy performance tracking.
- Monitor KPI trends through interactive dashboards and visual reports.
- Identify deviations instantly with automated alerts and notifications.
Seamlessly navigate between high-level summaries and granular data.
- Drill down into specific KPIs for detailed analysis and reporting.
- Aggregate data across multiple KPIs for a holistic business view.
- Link parent and child KPIs for structured performance insights.
Reduce manual effort with automated performance tracking.
- Configure custom formulas for real-time KPI calculations.
- Enable trend analysis for accurate performance measurement.
- Automate KPI updates based on predefined business logic.
Manage KPI settings and visual configurations with ease.
- Define and modify KPI formulas to match business requirements.
- Adjust the color settings to highlight performance deviations.
- Maintain consistency with centralised KPI governance and control.
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Digital Balanced Scorecard is a visual strategic planning and management tool. It aligns day-to-day activities with enterprise vision, mission, and values. Using a Balanced Scorecard tool, an organisation can analyse the KPIs associated with each strategic goal and measure their performance. By measuring performance and analysing performance strategies, the organisation will realise where they are now and what needs to be done to achieve the long or short term goals. Keeping track of Key Performance Indicators helps organisations track and monitor progress. It aligns employees’ performance with the long-term strategic goals of the organisation and determines whether you are moving in the right direction.
How to develop Key Performance Indicators effectively?
Define your overall strategy and identify the area of business performance that you wish to measure. The identified areas will have their respective KPIs in the following stages, be it financial performance or business growth.
Make a list of KPIs and discuss with teams to identify the KPIs that are closely aligned with each strategy. Identify KPIs which promote the overall business processes and ensure that these KPIs are closely aligned with strategic plans.
Follow the S.M.A.R.T framework to ensure that the identified KPIs are worth measuring. Ensure the KPIs are Specific, Measurable, Achievable, Relevant and Time-specific. SMART Key Performance Indicators are essential as they will help the management team avoid metrics that don’t impact business.
Keeping the KPIs clear lets your teams understand the KPIs and make data-driven decisions to move in the right direction. Let them know what is happening within the organisation and find ways for continuous improvement.
As your organisation grows, revise the KPIs that you are currently measuring. Monitor what is relevant and avoid the KPIs that are no longer relevant. Keep on updating the list of relevant KPIs to stay on track.
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Revolutionise your business with advanced KPI visualisation and management
Effective KPI management ensures that your business is on track to meet both short-term and long-term objectives.
Real-Time data insights
Quickly access up-to-date KPIs for faster, smarter decision-making
Customisable dashboards
Tailor KPIs and dashboards to suit your team’s needs and organisational goals.
Cross-Departmental alignment
Ensure that all teams are aligned toward common goals, improving collaboration and performance.
Hear it from our customers
MARC ROBINSON
Director, Global Operational Excellence
“By providing a central location to input, analyse and share our KPIs, 'Data Point' enables site management to more easily focus on the entire business as a team. Its ability to allow automated data entry and trend analysis gives us more time for improvement rather than just reporting numbers. Combined with a disciplined approach within our SQDC meeting process, I believe 'Data Point' will help us continually focus on key issues and drive business excellence in all areas.”
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