Key Performance Indicators

In our last blog article about key performance indicators, we talked about the effort involved in developing a good root question for KPI’s. Now, lets discuss developing a metrics plan.

Ingredients of a Good Metrics Plan

A good metrics plan will include a purpose statement, your basic question, the data, how you will measure the data, a timeline for using the metrics, how the metrics will be used, how they will not be used, and the users.

Whenever a supervisor/boss asks for data/reports to analyze performance, its important to remember the presence of fear and possible defensiveness. In the business world where time is money, any inquiries related to performance will automatically put the employee on defensive.

Let’s say Tom made a mistake in his department and told his supervisor, Peter. A week later Peter asks for a report on performance metrics within Tom’s department. Do you think that Tom will be on the defensive? Will he be absolutely honest about providing accurate performance data within his department?

Martin Klubeck in his book, ‘Metrics: How to Improve Key Business Results’, highlights four possible reactions that can take place when asking for performance data without offering any explanation for the reason:

You will get data that the data provider thinks you want to hear
You will get data that accurately reflects what the data provider wants you to hear
You will get accurate data
You will get a question – Why do you want to know?

If Peter mentioned that the purpose of him collecting this data was to send the data in anonymously to an industry association, Tom would be less defensive and in all likelihood provide accurate data. Therefore it is very important to clearly state the purpose of collecting data from employees, as well as stating how it will be used, and how it will not be used.