kpi - Blog - Global Risk Community2024-03-29T09:54:50Zhttps://globalriskcommunity.com/profiles/blogs/feed/tag/kpiKey Performance Indicators (KPIs) Best Practices: Your Guide to Driving Performance Improvementshttps://globalriskcommunity.com/profiles/blogs/ey-performance-indicators-kpis-best-practices-your-guide-to2020-03-16T06:30:00.000Z2020-03-16T06:30:00.000ZJoseph Robinsonhttps://globalriskcommunity.com/members/JosephRobinson808<div><p>More sophisticated managers explicitly use <a href="https://flevy.com/business-toolkit/key-performance-indicators">Key Performance Indicators (KPIs)</a> to promote cross-functional--not just vertical--alignment. For them, KPIs are the <a href="http://flevy.com/blog/wp-content/uploads/2019/12/pic-1-Key-Performance-Indicators-300x200.jpeg" target="_blank"><img src="http://flevy.com/blog/wp-content/uploads/2019/12/pic-1-Key-Performance-Indicators-300x200.jpeg?profile=RESIZE_710x" width="300" class="align-right" alt="pic-1-Key-Performance-Indicators-300x200.jpeg?profile=RESIZE_710x" /></a>means and methods for rigorously defining and measuring the fundamentals that matter.</p><p><em>Why are KPIs important?</em> If used effectively, KPIs can clearly track value creation and deliver value for its stakeholders – customers, employees, and investors.</p><p>KPIs are being used by organizations in different ways. Yet, there are clear and measurable differences that exist in terms of how it is being used. There are organizations that use KPIs to monitor and assess performance while there are those that use KPIs to guide and drive performance improvements. Data-driven and customer-oriented leaders use KPIs in practicing <a href="http://flevy.com/browse/stream/customer-centric-design">Customer-centric Design</a>, while those more concerned with hitting their numbers remain focused on efficiencies.</p><p>There are 4 primary <a href="https://flevy.com/browse/flevypro/key-performance-indicators-kpis-best-practices-4010">best practices for Key Performance Indicators</a> that organizations should follow. These best practices are every organization’s guide to using KPIs to drive <a href="https://flevy.com/business-toolkit/enterprise-performance-management">performance improvements</a>.</p><h3>The 4 KPIs Best Practices</h3><p>The <a href="https://flevy.com/browse/flevypro/key-performance-indicators-kpis-best-practices-4010">4 KPI Best Practices</a> can demonstrate the effective use of KPIs to reflect and illuminate the strategic priority of organizations.</p><p><a href="https://flevy.com/browse/flevypro/key-performance-indicators-kpis-best-practices-4010" target="_blank"><img src="http://flevy.com/blog/wp-content/uploads/2019/12/pic-1-KPI-1024x768.png?profile=RESIZE_710x" width="750" class="align-full" alt="pic-1-KPI-1024x768.png?profile=RESIZE_710x" /></a></p><ol><li><strong>Focus on Customer Experience (CX)</strong>. The first KPI Best Practice, Focus on Customer Experience is focused on an increased understanding of customers’ wants and needs. There is a renewed emphasis on learning more about users of products. The main objective of focusing on customer experience is turning customers into brand advocates and evangelists. When KPIs are focused on customers beyond the sales funnel, this encourages an organization to realign itself around sharing, coordination, and collaboration.</li></ol><ol start="2"><li><strong>Identify Top KPIs</strong>. When top KPIs are identified, it is basically identifying the priority KPIs. Doing this requires identifying the appropriate number of KPIs to prioritize. There are guide questions than can help organizations in the prioritization of the KPIs. One of the questions can be “Is there a consensus on how KPIs affirm and support strategy? Another significant question can be one that points to how directly the functional KPIs contribute to enterprise success. When going through this process, it is important that leaders understand how KPIs interrelate and align.</li></ol><ol start="3"><li><strong>Foster Enterprise-wide Discussion of KPIs</strong>. A very critical Best Practice, the third KPI Best Practice is focused on reinforcing the company’s culture. In fostering enterprise-wide discussion of KPIs, KPIs must be central to leadership conversations around driving organizational behavior and change. It is not merely an assessment tool. If KPIs are not front and center at a management meeting, there is something wrong with the meeting, the management, or the KPIs.</li></ol><ol start="4"><li><strong>Treat KPIs as Special Class Data</strong>. Treat KPIs as Special Class Data is the fourth KPI Best practice that is essential in process transformation and automation. Organizations must understand that data and analytics are the raw ingredients of KPIs. KPIs special class as a data asset will become even more important as they become an input to ML algorithm and process automation. In the years to come, organizations can expect that data capability that supports more complex KPIs will become a source of competitive advantage.</li></ol><h3>What Matters Most</h3><p>It is very clear that KPIs play a vital role in directing the priorities of organizations. With the changing global economy, organizations have been recognizing the importance of Customer Focus. In fact, it has taken a priority seat and identified as the top KPI by executives.</p><p>But does this hold true to all organizations? Identifying top KPIs is important but organizations must know the right way to identify the appropriate number of KPIs and prioritize them. It is important to note that KPIs must align well with the organization’s internal processes with its external customer behaviors.</p><p>Customer Focus is a priority, but is it also your priority KPI?</p><p>Interested in gaining more understanding of the <a href="https://flevy.com/browse/flevypro/key-performance-indicators-kpis-best-practices-4010">KPI best practices</a>? You can learn more and download an <a href="https://flevy.com/browse/flevypro/key-performance-indicators-kpis-best-practices-4010">editable PowerPoint about Key <strong>Performance Indicators (KPIs) Best Practices</strong> here</a> on the <a href="https://flevy.com/browse">Flevy documents marketplace</a>.</p><p><strong>Are you a management consultant?</strong></p><p>You can download this and hundreds of other <a href="http://flevy.com/pro/library/frameworks">consulting frameworks</a> and <a href="http://flevy.com/pro/library/consulting">consulting training guides</a> from the <a href="http://flevy.com/pro/library">FlevyPro library</a>.</p></div>Strategic Key Performance Indicators (KPIs) Primer: Introduction to The KPI Virtuous Cyclehttps://globalriskcommunity.com/profiles/blogs/strategic-key-performance-indicators-kpis-primer-introduction-to2020-01-25T10:51:23.000Z2020-01-25T10:51:23.000ZMark Bridgeshttps://globalriskcommunity.com/members/MarkBridges<div><p><a href="{{#staticFileLink}}8028306092,original{{/staticFileLink}}" target="_blank"><img class="align-right" src="{{#staticFileLink}}8028306092,original{{/staticFileLink}}" alt="8028306092?profile=original" width="595" height="440" /></a></p><p>Technological innovation and intensifying competition are forcing leaders to rethink how they use Key Performance Indicators (KPIs) to manage and direct organizations. Digitization has reinforced the importance of Key Performance Indicators not only in enhancing employee performance but driving the overall organizational productivity.</p><p>The role of KPIs is becoming more dynamic. KPIs are getting demonstrably flexible, smarter, and valuable in achieving strategic advantage. Leading technology-driven organizations—including Amazon, Airbnb, and Uber—rely on metrics considerably and utilize KPIs to steer their strategy and evaluate success. They perceive KPIs quite differently than traditional-focused organizations, and employ them as an input for automation, and to guide, regulate, and improve their machine learning tools.</p><p>To make the most out of these dynamic and <a href="https://flevy.com/browse/flevypro/strategic-key-performance-indicators-kpis-4031">strategic KPIs</a> of this Digital Age, leaders need to be more insightful and knowledgeable. They should be able to thoroughly determine which KPIs to analyze, how to measure them, and how to effectively improve them. Understanding the value of selected KPIs and their optimization is key to aligning strategies; making the right decision to invest in data, analytics, and automation capabilities; and create a link between people and machines.</p><h3><strong>KPI Virtuous Cycle</strong></h3><p>The relationships and dependencies that clarify, educate, and enhance KPI investment are demonstrated by “<a href="https://flevy.com/browse/flevypro/strategic-key-performance-indicators-kpis-4031">KPI Virtuous Cycle</a>.” By digitally linking KPIs, data, and decision-making into virtuous cycles, companies can align their immediate situational requirements with long-term strategic planning. The KPI Virtuous Cycle has 3 key components, and it demands active cross-functional collaboration:</p><ol><li><strong>Data Governance</strong></li><li><strong>KPIs</strong></li><li><strong>Decision Rights</strong></li></ol><p><a href="https://flevy.com/browse/flevypro/strategic-key-performance-indicators-kpis-4031"><img class="aligncenter size-full wp-image-6238" src="http://flevy.com/blog/wp-content/uploads/2020/01/Strategic-KPIs.png" alt="" width="1200" height="1079" /></a></p><p>The way these 3 components impact—and support each other—keeps changing. Organizations aspiring to become digital-savvy should embrace, value, and relentlessly invest in the KPI Virtuous Cycle.</p><h3><strong>Data Governance</strong></h3><p>The first component of the KPI Virtuous Cycle is about employing authority and control (planning, monitoring, and enforcement) through a set of practices and processes to manage organizational data assets. Leading digital organizations consider data as a strategic resource, a valuable tool for measurement and accountability, and a mechanism to facilitate meeting strategic KPIs. Data Governance frameworks are guided by strategic KPIs. Organizations should know what data sets would be ideal to predict and rank—for instance, customers’ lifetime value and their propensity to leave—to prioritize preemptive and preventive action. Data and Analytics serve as a component of Data Governance.</p><h3><strong>Strategic KPIs</strong></h3><p>Strategic KPIs shape and govern enterprise Data Governance models. These KPIs include financial, customer, supplier, channel, and partner performance parameters. For instance, Data Governance initiatives in customer-centric organizations are prioritized to facilitate in realizing customer-focused KPIs—e.g., <a href="https://flevy.com/browse/business-document/the-net-promoter-score-nps-3140">Net Promoter Score (NPS)</a> and <a href="https://flevy.com/browse/flevypro/marketing-automation-customer-lifetime-value-3008">Customer Lifetime Value (CLV)</a>. Enterprise Data Governance frameworks are strongly influenced and informed by strategic KPIs.</p><h3><strong>Decision Rights</strong></h3><p>Decision Rights ascertain the decision-making authority required to drive the business and strategic alignment. Making decisions in such a way that it boosts organizational performance involves identifying the individuals explicitly involved in making decisions, charting an outline on how decisions will be made, reinforcing with appropriate processes and tools, and defining various decision rights scenarios to facilitate in automation. It is, however, quite tricky to determine and assign decision rights when an enterprise is aspiring to empower its people and making machines function better.</p><h3><strong>Imperatives for Creating Dynamic and Strategic KPIs</strong></h3><p>For the KPIs to be strategically defined and become truly dynamic, the leadership needs to provide the required support by getting thorough data sets compiled and meaningful analytics performed. At the same time, there is a need to:</p><ul><li>Decide whether the decision rights needs to be assigned to individuals (rather than machines or vice versa.</li><li>Enhance the capabilities of people and machines.</li><li>Apply decision rights to generate data to identify and gauge productivity.</li><li>Identify the delays and bottlenecks between KPIs, data, and decisions.</li><li>Verify the diligence in the way KPIs, data, and decisions are mapped and monitored.</li></ul><p>Interested in learning more about the components of <a href="https://flevy.com/browse/flevypro/strategic-key-performance-indicators-kpis-4031">KPI Virtuous Cycle, its applications, and Strategic KPIs</a>? You can download <a href="https://flevy.com/browse/flevypro/strategic-key-performance-indicators-kpis-4031"><u>an editable PowerPoint on <strong>Strategic Key Performance Indicators (KPIs)</strong> here</u></a> on the <a href="https://flevy.com/browse">Flevy documents marketplace</a>.</p><h3><strong>Are you a Management Consultant?</strong></h3><p>You can download this and hundreds of other <a href="http://flevy.com/pro/library/frameworks">consulting frameworks</a> and <a href="http://flevy.com/pro/library/consulting">consulting training guides</a> from the <a href="http://flevy.com/pro/library">FlevyPro library</a>.</p></div>marcus evans to Host the 4th Annual Proactive Operational Risk Management Conference, February 5-7, 2018 in New Yorkhttps://globalriskcommunity.com/profiles/blogs/marcus-evans-to-host-the-4th-annual-proactive-operational-risk2017-11-16T21:11:54.000Z2017-11-16T21:11:54.000ZAmanda Pinkhttps://globalriskcommunity.com/members/AmandaPink<div><p><b>marcus evans</b> will host the <b>4<sup>th</sup> Annual Proactive Operational Risk Management Conference, </b>February 5-7, 2018 in New York, NY. This conference will enable institutions to better evaluate their operational risk programs so as to understand its value and how to improve. Delegates will gain knowledge on how to better identify and manage significant and emerging risks such as conduct risk and fraud, how to clarify responsibilities across departments and 3LOD and they will examine the regulatory environment and the future of operational risk. There will also be specific emphasis on managing cyber risk and enhancing data security from an operational risk perspective. This knowledge will ensure better operational risk management, minimizing the occurrence of incidents and cost for the business.</p><p><b>Key Practical Case Studies Include:</b></p><ul><li><b>Bank of Tokyo Mitsubishi</b> will assess how to enhance data security and improve cooperation of IT security and operational risk</li><li><b>Wells Fargo, BNY Mellon, Standard Chartered and more</b> will scrutinize and clarify the three lines of defense</li><li><b>KeyBank</b> will examine how to quantify loss events to optimize capital allocation for operational risk</li><li><b>Fannie Mae</b> will explore how to establish risk appetite for operational risk</li><li><b>AIG</b> will look at creating meaningful KRIs and KPIs to assess the effectiveness of the operational risk program</li></ul><p><b>Key Speakers Include:</b></p><ul><li><b>Gordon G Liu</b>, Executive Vice President, US Head of Global Risk, <b>HSBC</b></li><li><b>Rajeev Ranjan</b>, Senior Vice President, Operational Risk, Electronic Trading, Institutional Clients Group, <b>Citi</b></li><li><b>Nandini Sharma</b>, Senior Vice President, Operational Risk Management, <b>Wells Fargo</b></li><li><b>James Fisher</b>, Managing Director, Chief Risk Officer, <b>MUFG</b></li><li><b>Carrie Barranca</b>, Head of Audit, Operational Risk, <b>Standard Chartered</b></li></ul><p>For more information, please visit: <a href="http://bit.ly/2APMMgZ">http://bit.ly/2APMMgZ</a> or you can contact Amanda Pink at <a href="mailto:amandap@marcusevansch.com?subject=Agenda%20Request:%2012th%20Annual%20Liquidity%20Management%20(Supply%20Chain%20Brain)">amandap@marcusevansch.com</a></p><p><b><i>marcus evans</i></b> <i>conferences annually produce over 2,000 high quality events designed to provide key strategic business information, best practice and networking opportunities for senior industry decision-makers. </i></p></div>