Measures, Metrics and Key Performance Indicators
“I’ve always struggled to distinguish metrics from KPIs. Your clear explanation and simple examples have cleared the ambiguity. Thank you, Tracey.”
The right key performance indicators (KPIs) are the ones aligned to the objectives of a strategic plan. These KPIs will define what it means for each strategic objective to be successful, i.e., measurements of the desired results under each objective.
Moving a degree away from the strategic plan, each department or team contributes to the strategic plan objectives in some way. The metrics and KPIs of each team should therefore be aligned with their contribution to the key objectives and overall definitions of what is means for each objective to be successful.
Metrics and KPIs are an essential part of pointing each segment of the workforce in the same direction. They help every organization understand how their work contributes value to the overall company direction.
Without KPIs, the leaders of each team will not be aligned to the company’s goals and the objectives chosen by managers will not be connected. KPIs and metrics provide meaningful measurements of each team’s contribution to the success of the overall strategic objectives. Monitoring the change in these KPIs will inform the actions that need to be taken to ensure that progress on the objectives continues to be made.
Today’s business measures, metrics and KPIs are best presented in up-to-date, dynamic and customized dashboards in order to provide continuous visibility into strategic progress.
Beginner's Guide: Measures, Metrics and Key Performance Indicators [KPIs]
You can visit our brief beginner’s guide to measures, metrics and KPIs or download our eBook from Amazon.
Metrics Dictionary
Inventory Metrics
Cost of Inventory
Time to Ship
Supplier Performance Metrics
Parts per Million (PPM Quality Measurement) or DPMO (defects per one million opportunities)
Supplier Delivery Time & Variation