What exactly are Key Performance Indicators? Created by Federico Viola

* A KPI is a measurable achievement that helps a company to understand when success has been achieved.

KPIs are a good way to measure: * an employee’s performance * the performance of a business or a section of a business. * KPIs help individuals to understand what direction a business is heading * KPIs help employees to align their work with the overall vision and goals of the business

A KPI must be measurable! Measurable means: * It can be written as a number (eg Sales target of A$100,000) * It has a time frame or due date (eg Sales target of A$ 100,000 per calendar month; or turnover A$ 1,000,000 of warehouse stock by October 12)

A Key Performance Indicator links operational goals and outcomes to the strategic goals of a business! This means, that the running of the business and actions of the staff reflect strategic goals and planning of the business.

STEP 1 * You commence by understanding the context * ‘What is the vision for the future? * What is the strategy? How will the strategic vision be accomplished? * What are the organization's objectives? What needs to be done to keep moving in the strategic direction? * What are the Critical Success Factors? Where should the focus be to achieve the vision?’ Source: Mindtools.com

STEP 2 * Think about what needs to achieved and write it down! (a task or outcome) * How would you measure it? What is the benchmark? (a quantity) * What time frame is suitable? (measurable in time) * How can you continuously ensure that a KPI is a good measure? (continuous improvement)

* In small teams of 3-4 answer the questions handed out by your teacher!