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HOW TO MAKE KPI WORK TOWARD OUR BUSINESS RESULTS?
(by Choong Ewe Lee)
(choong@brainperformance.com.my)

   
 
     
 

As per my previous article, I hinted that we could improve our Business Performance by focusing directly on Result based KPIs, instead of Activity based KPIs. So, what is the key difference of Result based KPIs and Activity based KPI ?
•    The activity based KPI is to measure “How much work we have completed?”
•    The result based KPI is to measure “How much result we have achieved?”
 
  Would Result based KPIs so critical to reflect Business Performance ?
•    For Sales, our Bosses may care about “how many clients we have visited?” (activity), but they are more
     concern of “how much sales revenue we have generated?”
•    For Finance, Our Bosses may care about “the dateline of Financial Report submission”, but they are more
     concern of “how well we control operating expenses” or “how far can we reduce our cost of financing?”
 
 
A Consulting Case for reference : This is manufacturing firm at the size of 60 million of business a year. Mr. Nik, the HR Manager has set his KPI on “how many annual training hours being provided/employees”. No doubt, this is the most common indicator used to track training performance. However, if we think twice, our Operations Managers (i.e. from Production/ Warehouse/ QA/ etc) are more concern of “how many hours of training being attended by their staff” (activity) or “the upgrading of their staff competency after the training”. The answer is quite definite.
 
  A tip to share : There is one time during my public training workshop, a participant, Kenny Chia asked me that, “Can KPI help to change the Staff Attitude?” Without 2nd thought, I replied, “It is definitely, “YES”. I have made it work for my Consulting Team, but also for some of my KPI clients".
 
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