KPIs must be Key Success Factors
A lot of things are measurable, it doesn’t make them being at the origin of the success of the organization. At the moment of selecting the KPIs it is critical to limit them at those essential to reach the organization goals.
In parallel, it is important to limit the number of KPIs to maintain the attention of everybody focused on the same goals.
This doesn’t mean that, for example, a company will have only three or four KPIs. It means that there will be three or four KPIs for the management committee and each unit will have its own three or four or five KPIs that measure the achievement of the company’s goals once broken down at the department and unit level.
If one company’s goal is to “Increase customer satisfaction”, the corresponding KPI will be oriented in a different way in each department. The manufacturing department can have a KPI about the “Number of units rejected by the quality control », whereas Sales will have a KPI about the »Time waiting for a customer before a salesman takes the call ». If the sales and manufacturing departments increase their respective KPIs, it will help the organization to increase its KPI at the aggregated level.