ON TARGET

ON TARGET

© StratCap International Ltd

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KPI’S DON’T STAND ON THEIR OWN

Key Performance Indicators no only for MN’s but also for SME’s


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S

strength

W

weakness

O

opportunity

T

threat

Sustainable Competitive

Advantage $$$

Key

Leverage

Points

Business

Implications


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SWOT

Objective

Strategy

Plan

Execute

Measure

Vision Mission

Ethics CSR

Risk

Indicators

Success

factors


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Change data into Information

Key Performance Indicators (KPI)

Use them smart, focused and limited

Adapt them to the project/ department/ market

Visualized them for quick overview – Dashboard

Adapt them to the progress made

A tool NOT a target – the trend NOT the number

The fundamental navigation tools to stay on track or getting off target

Share them with the team so all will carry them


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ET 18 SMART KPI’s

Financials

(7)

Market

(5)

Operations

(8)

Team

(5)

7 KFI’s


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FINANCIALS (KFI’S)

Measuring and understanding your


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Revenue Growth rate

Gross Profit Margin

Operating Profit Margin

EBIT

The rate at which

you are

increasing your

company’s

income.

The percentage

of your revenue

which is gross

profit (Profit

generated for

each product

sold – Revenue

minus Cost of

Goods ).

Operating

income divided

by revenue –

another measure

of a company’s

profitability.

Smart FINANCIAL performance kfi’s

Earning before

Interest and Tax,

but certainly not

the only metric

you need to

worry about!


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Net Profit Margin

Return on Investment

Cash Conversion

Cycle

The percentage

of your revenue

which is net

profit.

The returns

generated by

investing money

into an aspect of

a company’s

operations, in

relation the cost

of that

investment.

It measures how fast a company can

convert cash on hand into even more

cash on hand. The CCC does this by

following the cash as it is first

converted into inventory and accounts

payable (AP), through sales

and accounts receivable (AR), and then

back into cash.

Smart FINANCIAL performance kfi’s


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MARKET



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Net Promoter Score

Customer Profitability Score

Customer Retention Rate

(NPS)

How likely is it that a

customer will

recommend your

business to a friend?

Click for more info

(CP)

How much profit do

individual customers

bring, after deducting

the costs of attracting

and keeping them

happy with advertising,

customer services etc?

Click for more info

How many of your

customers are going to

come back for more?

And how loyal are they

to your brand,

organization or service?

Click for more info

Smart MARKET performance kpi’s


http://www.netpromoter.com/why-net-promoter/know/

http://en.wikipedia.org/wiki/Customer_profitability

http://en.wikipedia.org/wiki/Customer_profitability

http://en.wikipedia.org/wiki/Customer_retention

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Conversion Rate (Relative) Market Share

How well do you

translate enquiries,

sales calls and tenders

etc. into paying

customers?

How big your slice of

the pie and how is this

compared to your

competitors.

Smart MARKET performance kpi’s


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OPERATIONS



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Capacity Utilization

rate

Project Schedule Variance

Project Cost Variance

Earned Value

(CUR)

Are you meeting

your potential in

terms of amount

of work you can

carry out, with

the resources you

have available?

(PSV)

Are your

projects

reaching

completion on

time?

(PCV)

Are your

projects coming

in within the

budgeted

expense?

Smart OPERATIONS performance kpi’s

(EV)

Value generated

by your

company’s

ongoing

projects.


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Order Fulfillment Cycle time

Delivery in full in time

Quality Index

Process Downtime

Level

(OFCT)

The time that it

takes from a

customer placing

an order, to the

product or

service being

100% delivered.

(DIFOT)

Customer orders

filled in full, and

on time,

compared to

total number of

customer orders.

The quality of

your goods or

services as high

as your

customers are

expecting?

Smart OPERATIONS performance kpi’s

How much time

is wasted due to

downtime,

technical

breakdown or

staff sickness.


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TEAM



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Staff Advocacy Score

Employment Engagement Level

Absenteeism Bradford Factor

How likely are your

staff to recommend

you as a company to

work for?

How does your

employee’s behavior

contribute to the

business’s overall goals?

How much is

unauthorized staff

absence costing your

business?

Smart TEAM performance kpi’s


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Human Capital Value Added

3600

Feedback score

(HCVA)

The financial value

added to the business

by individual members

of staff.

How staff rate each

other – as well as

themselves.

Smart TEAM performance kpi’s


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Use a DASHBOARD and GRAPHS

“A dashboard is a visual display of the most

important information needed to achieve one

or more objectives; consolidated and arranged

on a single screen so the information can be

monitored at a glance”


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ADAPT

Strategic Dashboards

• Used by executives

• Overview on the health of the business, incl. major high-level measures

• Few information, simple display mechanisms, static snapshots

Analytical Dashboards

• Used by analysts

• Support interaction with data, e.g. drill-down

• Complex data, sophisticated display mechanisms, static snapshots

Operational Dashboards

• Used to monitor operations

• Support alerting for critical events, interaction with data

• Detailed data, simple and clear display mechanisms, real-time data


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First

Generation

Second

Generation

Third

Generation

Display:

Simple Lamps

Function:

Indication of engine issues

Evolution of DASHBOARD

let

Automobile Dashboards Business Dashboards

Display:

Simple Charts

Function:

Simple monitoring of

some business areas

Lamps

Gauges

Odometers


Measure fuel, etc.

Measure speed, distance

Advanced Charts

Gauges & Indicators

Tables

Advanced monitoring

Drill down to analyze

Monitor key metrics

Lamps

Gauges

Odometers

GPS


Measure fuel, speed, dist.

Show route & destination

Advanced Charts

Gauges & Indicators

Tables

Scorecards

Strategy Maps

Advanced monitoring

Drill down to analyze

Monitor key metrics

Monitor tactics

Monitor strategy


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STEP 3

SET TARGETS TO IMPROVE

STEP 2

MEASURE & UNDERSTAND

STEP 1 RUN YOUR BUSINESS –DO WHAT YOU NEED TO DO

Lets Get Started


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StratCap International Ltd

216/4 Dien Bien Phu, Q3,

Ho Chi Minh City

Vietnam

[email protected]

Contact


mailto:[email protected]

ON TARGET

Business

Transcript of ON TARGET