Blog Posts

Post Category: ‘KPI & measure design’

The KPI substitution heuristic – or why use a KPI in the first place?

Why use a KPI?  There is a lot of discussion about which particular measure, indicator of KPI to use.  There is far less discussion about why use a KPI in the first place.  Actually, the reason is often a heuristic.  Let me explain…. To solve difficult questions, we often look for a simpler question to answer. I am still reading …

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Milestones and activities are not measures: but they are still useful

I was listening to my colleague and friend, Stacey Barr this week.  In her seminar, she was making it very clear that many make the mistake of using things that are really milestones or activities, when they are talking about measures.  She is right.  However, people are using them for a reason, and I want to explain why. As Stacey …

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Leading indicators: Ten different types for different situations

Leading and lagging indicators seem to create confusion for some people, yet with a clear understanding, it is easy to see explain how they work and help people think productively about how to create and use them. In this article I want to explain how different types of leading indicators are needed and will occur in different circumstances.  I will …

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OFWAT, Outcomes and Outcome thinking – be very careful!

If you are in the water industry and have read any of the OFWAT documentation on outcomes, this article will help you. If you are in OFWAT, you should be embarrassed by the material you have put out which shows a woeful understanding of the use of outcomes. Let me explain. OFWAT’s use of outcomes for price determination OFWAT’s move …

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Don’t just manage what you can measure: Measure what you want to manage.

Balanced Scorecard principles: Measure what you want to manage: So often you will hear: “What gets measured gets managed”. I want to put a different perspective on this because our experience is that this is far too simplistic an approach: Management is a far richer than simply measurement, ins’t it. A better phrase might be: “Don’t manage what you can …

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What is the difference between a measure and an indicator?

What is the difference between measures and indicators?  This question has become a perennial topic on many discussion forums:  measures, indicators, Performance indicators, Key performance indicators (KPIs).  To us there is a clear and useful distinction. Unfortunately, in many organisations there is a very loose language that merges these separate words, measures and indicators, into a single thing.  They are …

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Leading indicators and lagging indicators – making sense of them

I see many conversations about leading indicators. People searching for a leading indicator, or arguing whether an indicator is leading or lagging.  This article provides a simple way of breaking through this problem. The whole debate about whether an indicator is leading or lagging is one of perspective. Not (simply) perspective in the balanced scorecard /strategy map sense, but in …

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Cascading balanced scorecards for meaningful measures & KPIs

If you have ever tried to cascade measures in a balanced scorecard you have a problem that is common to many starting down the cascading balanced scorecard route. By developing the scorecard you look for the right measures that will cascade as meaningful drivers of the behaviours and results of others.  However, in making those steps the gap between strategy …

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Effective KPI development

Recently I ran a KPI development workshop for a Public Sector client.  The feedback was interesting: “Seeing the whole picture enabled us to be more confident when dealing with business units, enhances our business knowledge and helps is pick out anomalies.” “We can adopt these principles of objective setting to see KPI measures in a new light.” “We realised how important …

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Performance management and cultures: Nine tips

On a Linkedin discussion a Chief Executive from a Housing Association asked about how best to go about a)  the process of identifying and measuring leading performance indicators. b)  with practical experience of implementing performance management systems and cultures. Having worked with Housing Associations in the past, here were seven quick tips (Which would apply in almost any organisation): 1) …

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