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The Impact of Effective KPI's

At Mainspring Solutions, we consistently harp on improving business processes to yield the greatest output with your given resources. As we have discussed previously, implementing lean operations or identifying/removing defective processes are both effective ways to help your business prosper; but, at the heart of this lies the concept of KPI's.

KPI's (Key Performance Indicators) are company goals that are often derived from an organizational strategy, then measured through performance management tools. These goals should meet the typical "SMART Goal" format of being all of the following: Specific, Measurable, Attainable, Relevant, and Timely.

KPI's can vary in their reach and impact. Paired with enterprise-wide and departmental KPI's, we suggest that individuals set their own key performance indicators to help with personal development within projects or their own department of practice. However, KPI's are typically most effective when they are shared intra-department across an organization. Experts believe that aligning goals across a collective of owners creates a "shared accountability" that generally leads to greater outcomes.

The concept of KPI's is especially important for managers to understand. According to a Harvard study, only about 10% of employees at any given time are polarized on the spectrum of working very efficiently and very inefficiently. The remaining ~90% of the staff seeks clear task/goal setting for them to properly perform. The philosophy of KPIs rely heavily on the following principles:

1) Continuous monitoring of the company strategy implementation

2) Employee responsibility is distributed in a manner that each employee is responsible for achievement of the organizational objective

3) "If you are trying to manage something, you have to be able to measure it"

So how do we get started?

The first step entails starting with an analysis of the reasons of the business problem; the first step in fixing a problem is identifying there's a problem. Next, we collect that data surrounding the issue. Mapping out the connection between factors can potentially lead to easier discovery of where the disconnect lies. Then, we revise the phrasing of these factors into actionable objectives and assign individuals or teams to the task of fixing said issue in a given time period. This task must be able to be consistently measured, preferably visually, so that the team can take additional ownership by seeing improvement taking place. There are many mediums of analyzing KPI data, like bench marking software/dashboards that puts all of your achievement data at your fingertips. Once the objective is reached, proper reward should be distributed and effective (as well as the inefficient) methods that were used.

At Mainspring Solutions, customers routinely send us requests to put together KPIs for distribution operations. We have since designed a toolkit that focuses on combining concepts with readily available and affordable technologies to develop these metrics for our customers. If you would like more information on the Mainspring Toolkit, please email Thom Rogers at and he will be able to provide you with more information!

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