Holding an Indicator Discussion for KPI Systems



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Key performance indicators are usually employed in comprehensive systems to measure organizational performance, and holding a regular indicator discussion can do much to keep a KPI system in line. Check additional information about Indicator Discussion.

The use of key performance indicators as a paradigm in managing organizational performance as a whole is widespread because of its undoubted effectiveness, when properly implemented. Entire systems can be constructed around the measurement and monitoring of these parameters, which would in turn yield valuable information describing past and current performance. Managers could of course then use this information to, for instance, optimize business processes, single out the best and worst employees and take the appropriate actions, determine the effects of the economy on the organization, and so on. Such KPI systems would benefit greatly from a regular indicator discussion.

A discussion such as this usually refers to a companywide meeting or summit in which the different departments and parts of the company come together to talk about their respective measurements. That is, the goal is that of synthesis and integration, allowing people to situate their own performance within that of the company as a whole. Different components of the company would get the chance to relate their metrics data with one another, giving some life to the seemingly lifeless numbers (on which bonuses and incentive schemes usually hinge!). A meeting like this would also serve to help correct the tendency of the different groups in the company to drift apart, focusing on their own ends and processes. This might be caused, for example, by an excessive focus on improving metrics values without proper integrative discussions to put the numbers into context.

This can be of critical value in large, complex organizations with many and varied internal processes and drives. In environments like that, one department may be far removed from another, and yet still have some links, strategically. It would then be foolish for either to overlook their connection, and yet if each focuses only on improving its own performance as measured by its set of KPI's, then that would exactly be what might happen. For instance, a sales team might focus aggressively on getting new customers to the detriment of the strategically more important measure, customer retention. Front desk and service components might feel alienated from their own imposed metrics without a clearer view of how it relates to organizational performance. Many more examples may be given, but the general gist of things is the same.

Holding an indicator discussion provides the venue to address these and any other problems that might arise in running the system. For greater cost effectiveness, incentives and disincentives may also be deliberated upon and announced in these discussions, and other maintenance tasks may be performed on the system. Essentially, the most important part of these discussions would be those that would help everyone get a better grip on the underlying context. Showing everyone the bigger picture would help them not to get as lost in their own responsibilities as to forget about their connections with the rest of the company. And, of course, such discussions would offer a venue for further tweaking and improving the system, leading to better productivity and increased progress in the long run.

If you are interested in Indicator Discussion, check this link to find out more about indicator discussion. Also, you can check other articles in BSC Training category.



 

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