Your KPIs do not seem to be very Key...

A friend of mine is a sales manager in a large retail store and recently he came up to East Putney to meet me for some lunch. Following on from our usual discussions and a random sighting of Greg Wallace from Masterchef (being his restaurant, maybe it was not that random) we began talking about his recent frustrations at work.

It seems his company has a rather different outlook to how KPIs should be implemented, and this in particular seemed to be his biggest cause of recent frustration. “I have been given 16 KPIs and not one of them is related to the sales”

I was very surprised with this statement. There were so many things wrong with it, it was genuinely difficult to know where to begin. After a few moments to gather my thoughts, I pointed out the following observations:

16 KPIs?! Nobody ever should have this many KPIs; 7 at most. They are designed so you focus on what really matters, so how can anybody focus on and manage 16 KPIs simultaneously to improve performance? It can’t be done and most of his time will be used (and wasted) in reporting.

No sales KPIs? Hang on…I thought you worked in a sales retail store? I found it incredible that in a retail store where it all about sales that there cannot be a single sales KPI. KPIs measure the key processes of your role to improve what you already do. In no circumstance should it conflict with your day-to-day work.

Given to you? Anybody who understands KPIs will be able to tell you that KPIs should never just be ‘given.’ For a manager to take full ownership of their KPIs, they need to feel engaged and accountable. Therefore they need to be involved during the KPI Implementation process. If this part was considered, it may have even stopped the other 2 situations occurring.

My friend agreed with my observations and even offered his own. Despite this, and as we all know, changing policies in large companies is certainly not an easy process. Therefore as it stands, he will continue to manage his not-so-key performance indicators. 

The real value of practising what you preach

Sometimes you need to ‘practise what you preach’ in order to fully understand the benefits of your product.

Everybody 'knows' what the benefits of their products are. For instance, I could tell you how simple, practical and effective our KPI management System is and why it is more powerful than alternatives on the market. But that does not necessarily mean you fully understand its true value. This is something that certainly applied to me and why I now understand the importance of practicing what you preach.

At Experian UK, I was the system administrator for 600 system users across our business units. It was my duty to support all the KPI Managers with the system; explaining how to use it and why.

The trouble was though, I was only supporting the process and not part of the process. I was on the outside and therefore not embracing what ICG was really about.

Clearly I always liked the product. So much so that I even ended up joining Qualitin! But it was the day of our Partners event where I understood ICG's value. This is the day where I knew I would be required to present my KPIs, results and proposed actions.

Having all your data on display for everyone to see meant there was no hiding away. Everybody could clearly see what my targets were for the month and what I had actually achieved. Everybody could see my red KPIs (unfortunately there were a few that day I recall) and so I explained what I intended to do about improving the situation for next month.

It was at that moment though where it all made sense. Firstly having my data on display had provided me with the necessary self-discipline to be appropriately prepared for the meeting. I did not want to be shown up after all. Secondly, everybody was less interested in the fact a couple of my KPIs were red. The focus was far more on my analysis of the situation and what I intended to do about improving it.

Therefore now when I describe ICG to someone I would no longer just use the words ‘simple, effective and practical’. These just describe ICG as just a tool and certainly do not provide ICG justice. Instead the words ‘ritual’, ‘forward-thinking’ and ‘self-discipline’ are a better match because these words describe what ICG does, not what it is.

Now, and only now I can now honestly say I understand the true value of my product.