The Right KPI Metrics Measure the Success of Your Company
Key performance indicators, or KPI metrics, provide a way for you to see, at a glance, how your company is performing. The challenge is that no set of KPI metrics will work across the board for any company, or even every company in a given industry. There are certain measures of your company’s health that will promote growth and protect a solid employee base, but you have to identify which metrics serve you best.
There are several considerations you should keep in mind when you identify KPI metrics for your company:
Limit yourself to a short list. You may start out with a dozen or more performance indicators that you identify as having a significant impact on the success of your business, but you need to whittle many of those away. Your list of KPI metrics should be limited to four or five at the beginning. Once you begin to work with those measures of your business, you’ll likely see whether you need to make adjustments or add one or two important metrics.
It’s not just about cost. Of course, you will have a couple of metrics that measure cost areas, such as your profit margin or your projected costs versus actual. However, many companies start there and don’t capture the key drivers of their company’s health. Don’t forget to include those measures that balance the consideration of cost, such as volume or time measures.
Consider tracking those behaviors you want to eliminate. For many companies, one of the KPI metrics they want to include feature an area they’d like to improve because it is costing the company money and limiting growth. For instance, you may want to track invoicing errors, because corrections are costly and the mistakes impact customer satisfaction. You could also track delivery time from the time of the order, if that’s an area that is becoming costly.
Address your unique challenges. Your KPI metrics are flexible, so think about what is plaguing your company right now. If high turnover is a problem, take steps to identify a strategy for hiring the right people and keeping them on board. Once you have had a solid strategy in place for a couple of years, this metric may be replaced with another.
Get the right tools to track your KPI metrics. If you don’t have a software system that tracks your KPI metrics in a business dashboard, you should consider whether it might be time to upgrade your software. Intacct, a best-in-class cloud software solution, offers real-time, role-based dashboards that allow you to view KPI metrics with the click of a button. You’ll see the progress of your metrics, and identify problems before they impact your bottom line.
At One Vision Solutions, we understand the important role of KPI metrics in a project management company. We recommend Intacct to many of our clients for many reasons, but the ability to view metrics on a business dashboard is a game-changer for many companies. It adds a high level of visibility, making it easy for you to see how you are meeting your objectives. We look forward to talking with you more about your software needs, so give us a call.