Define it right to get it right!

Define it right to get it right!

Key Performance Indicators (KPI) or Metrics are the indicators which the CXO’s look for while evaluating the performance of the organization. They serve as a direct indicator of the effectiveness of the current organizational strategy and this is what makes sense at the top management.

The teams who typically look after the evaluation/ implementation have little idea about the specific KPI’s that the organization needs to track and generate reports for. The teams usually provide vague answers like “We are looking at sales and cost related KPI’s” and so on. This indicates that the team has not clearly understood the important KPI’s to track and hence there is a need to connect with the executive management before going in for a BI implementation.

There is a need to pay attention to each detail in the business process of the organization in order to identify and monitor the KPI’s which can help the organization to improve profitability.

The process to know these KPI’s is very crucial and it’s important to collect significant details around KPI’s:

  1. Name of KPIs
  2. How executives define these KPI’s, how they measure and calculate
  3. Understand from the executive’s perspective, which business processes impact or influence this KPI, which roles and who has the maximum influence on the KPI’s.
  4. How often is the KPI to be reported?
  5. Establish clear connection between the KPI and the applicable
    Organizational Strategy
  6. It may also be beneficial to understand on how these KPI’s will be able to achieve the organizational as well as personal goals.

Hence, understanding the KPI’s prior to implementation of a Business Intelligence solution will provide good results which can benefit the organization in the long run.

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