I’ve just got back from doing a presentation to an accountants’ professional development conference. I’m on a gig where I do several of the same presentation in different cities. The conference organizers gave the presentation the rather mind-numbing title of Using KPI* Reports to Enhance Organizational Performance.
Someone once told me that the way I get on in life is that I’m prepared to spend my time thinking about things (he was actually referring to analyzing KPI lists at the time) which most normal human-beings would find painfully boring.
Now, the great thing about accountants is that they’re a bit like that too – you can’t scare them with a dry little title like the one above, so I had plenty of people turn up to my session.
The fact is that KPI lists (in various forms) are the central mechanism by which we translate our ideas about what should happen in the world into what actually happens on the ground. They’re a major determinant of the way the world turns out in the end. The accountants are right on the money with this one, sparing 50 minutes or so to talk about how to get KPI lists right is time well spent.
I started off my presentation by critiquing two of the most popular sayings in the KPI world – ‘what gets measured is what gets done’ and ‘organizational objectives should always be SMART – Specific, Measurable, Achievable, Relevant and Timebound’.
The problem with the first is that it results in: ‘what doesn’t get measured, ends up being absent from strategic discussions’. And the second (SMART ) can lead to a nasty organization problem – PM – Premature Measurement. Moving to measurement too fast before you’ve defined your strategy.
The take away points from my presentation were: 1) we need to identify our strategy before we focus just on measurement; 2) the best way to talk about strategy is to do it visually; and, 3) once we’ve developed a visual version of our strategy, we can then simply map our indicators (KPIs) directly back onto this map. This ensures that we have alignment between what we’re measuring and the priorities we’re trying to achieve.
One of the participants asked a key question, which is, ‘what it the best way of working out which indicators, out of a mass of indicators we might have, we should track?’
The simple answer is that the indicators we select should focus on our priorities. Working the way I suggested in my presentation is an ideal way of doing ensuring this. However there are some very interesting complexities around the question of indicator selection which I’ll try to get time to blog about in a few days time.
I’ll post the KPI presentation after I tweak it and do the next presentation.
*Key Performance Indicators, if any of the uninitiated are reading this blog.
Outcomesblog.org 