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BLOG: What’s important about ‘Key’ in KPI


Thursday, April 29th, 2021

What’s important about ‘Key’ in KPI

In digital in particular, where there is a plethora of available data, working out what is important and should be surfaced and reported on can be a tricky business. Data is only valuable if you can use it and it has applicability to the goals and objectives you are trying to achieve. Understanding the questions people want to answer, why they are important and how they link to goals and objectives will help ensure its relevance.



KPI (Key Performance Indicator), like strategy and leadership, is an overused and often misunderstood term. As a result organisations can end up being weighed down by reporting and analysis that adds little or no value but can absorb hours of time and considerable resources as ‘reporting industries’ grow up inside them.

A dive into Google quickly surfaces the issue. A strategic measure, a measure of progress towards an intended goal, a measure of performance and a measure that can be applied at every level of the organisation were all mentioned in the first seven or eight searches. Then there is the theory of ‘5’ KPIs which drives a considerable amount of motivation thinking and there are also balanced scorecards and many other such performance management tools.

In digital in particular, where there is a plethora of available data, working out what is important and should be surfaced and reported on, versus what can be left in a source application or tool for use by those accountable for performance in a particular aspect of digital business can be a tricky business – after all what do you leave out?

Actually, it’s asking that question that can lead to it all going badly wrong.

There are two management aphorisms that don’t help here – one is what you measure is what gets done and the other is measure what matters. One can inadvertently drive you down from macro to micro and the other can encourage people to avoid hard choices and measure far too much as it all matters to someone. Both hide sensible starting points behind the oft repeated cliché.

In our experience of working with digital transformation the following are useful pointers when thinking about what really is key as you thinking about digital reporting:

Its more important to look where you’re going rather than at where you’ve come from

You can’t do much about the past, but if you know where you’re going and track if you’re getting there in a way that helps you adjust and keep moving forward then that will be more valuable.

Insight is better than hindsight

Measuring what helps you understand and then make informed decisions about the future is generally more valuable than reporting what happened that is easily found elsewhere

Strategy and tactics

Both are important, but its better they aren’t conflated and that they are clearly linked. Tactical success should take you towards strategic goals. If it doesn’t then why do it? If you have to do it (e.g. match a competitor promotion in a key period) then don’t spend time reporting on it outside the team that need to know.

Holistic thinking beats functional mindsets

Taking a siloed approach to the identification of metrics ensure alignment up and down an organisation but not across it and will, more often than not, ignore the customer. Ensuring the logic is organisation wide and is focused on the customer is more likely to drive out what is important to the organisation as a whole.

Utility and application is more important than anything else

Data is only valuable if you can use it and it has applicability to the goals and objectives you are trying to achieve. Understanding the questions people want to answer, why they are important and how they link to goals and objectives will help ensure its relevance.

Once you know this, it is far easier to build narratives that help people use data to drive performance. And it’s the story behind the data that delivers the value. If you want to know more about this then take a look at www.4front.goodgrowth.co.uk





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