Step 1 : Decide what to measure

Step 1: Decide what to measure

The first hurdle a company must face is to decide exactly what to measure. There are many KPIs available and so you must be guided by your own company goals and project goals – your critical success factors – to ensure that the right KPIs are chosen in the first place.

Examples of Critical Success Factors:

  • For companies facing a recruitment crisis, for example, a critical success factor could be staff retention;
  • On some projects a client can afford to go over-budget; the critical success factor here could be value for money.
  • At other times, it could be critical that the project is on-cost: the client may have budget constraints or the nature of the contract may mean that no extra money is available for the project

Choosing Key Performance Indicators:

  • If staff retention is critical to the business, measure and monitor Employee Satisfaction!
  • If the client demands VFM, measure Client Satisfaction!
  • If a project must be delivered on cost, monitor Cost Predictability!

 Other rules of thumb:

  • Select a suite of 8 to12 KPIs - any more than that and data collection and processing can be arduous and taking action, following benchmarking, can be a mammoth exercise.
  • Do not duplicate information flows that are already established and functioning well.
  • If you have not tried performance measurement before, select a mixture of company and project KPIs covering the three aspects of sustainability – economic success, social improvement and environmental performance. That is, unless you have a very high priority area that means you need to specialise in a particular area of performance measurement (e.g. environmental performance)

Client commendation;

Peter Schofield, Programme Manager, North East Improvement and Efficiency Partnership, “In my experience, picking KPIs is really difficult. And it is even worse if you’ve got a number of organisations round a table trying to agree a common set of measures. Because we’re working in the public sector, our KPIs need to reflect government priorities – in our case, sustainability and efficiency.”



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