Key Performance Questions

Key Performance Questions

7/10/2018

Key Performance Indicators

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Business

Key Performance Questions (KPQs) enable managers to generate metrics that are aligned with their organisation’s objectives. KPQs allow managers to identify criteria for information that would address their organisation’s strategic questions. They would also allow managers to apply performance data to an organisation’s present conditions. [1]

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Factors of Key Performance Questions

In order to devise relevant KPIs, the Advanced Performance Institute (2010) encourages managers to create Key Performance Questions that consider these factors:

1. Collection Method

Managers should analyse the strengths, weaknesses and relevance of different data collection methods that their organisations may adopt.

These data collection methods may include employee and customer surveys, interviews, focus groups, collecting information from archives, etc.
Managers should compile the following information within their reports:
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• Summaries of each data collection method;
• Source of the information that the organisation will collect;
• Scope of the organisation’s data collection initiatives;
• How data will be quantified;
• How often and when data is collected; and
• Personnel who are responsible with collecting and updating strategic data.

​Managers may also determine how data will be measured with quantifiable metrics. They must determine if data may be measured according to formulae, aggregated indicators or indexes, or alternative forms of calculation. [2]


2. Source of the Data
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Managers should also identity where they would obtain strategic information. They should consider:

• How data would be accessed;
• Availability of data;
• Feasibility of data collection processes; and
• Accuracy of the data collection method. For instance, managers may predict if employees would provide honest answers during their interviews. [3]

 
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3. Frequency and Timeline

Recent studies claim that performance evaluations are not conducted as often as they should be, as most organisations conduct performance evaluations approximately once a year. These evaluations may not generate sufficient data as there are prolonged gaps between these assessments, and corrective initiatives may not be effectively monitored.

In order to address this trend, managers should also survey a percentage of their employees instead of their entire division. Furthermore, they recommend conducting evaluations on a monthly basis, as organisations would receive sufficient data to formulate their KPIs.

Analysts also claim that data collection initiatives are sporadic and fragmented. Organisations which collects their data from multiple divisions at different times, and with different indicators, would fail to obtain accurate information about their overall performance.

Managers should address this trend by establishing clear deadlines and criteria for their performance evaluations. They should create a specified data collection schedule, and outline the reporting requirements of their KPIs. They should conduct their studies within a period of time that allows them to:

• Collect data from employees who have not completed their assessments in time;
• Analyse and apply their findings to developmental initiatives; and
• Correct any issues or discrepancies in the evaluation process. [4]

 

4. Data Personnel, Targets and Metrics

Organisations should select personnel to assume responsibility for their data collection initiatives. Organisations may establish an internal division with competent employees, or they may employ an external agency to monitor its KPIs.

These individuals would be responsible for establishing benchmarks for employee performance. These benchmarks must be specific to the organisation’s key objectives, and must be aligned with managers’ expectations.

Recent studies state that effective targets may adhere to the following guidelines:

• Targets should be aligned to an organisation’s key objectives, and should be measured across a specific timeline;
• Targets should challenge an organisation’s workforce, but should be achievable with its given resources;
• Targets should be based on existing information about an organisation’s internal and external environment; and
• Targets should consider variations in an organisation’s performance, such as peaks, troughs and seasonal factors. [5]

Given the right circumstances, managers may also establish targets that are aligned with benchmarks that other companies have established in their industry.

​However, if they choose to measure their performance according to these comparative indicators, they should select KPIs that are also relevant to their company’s current initiatives. This ensures that their organisation’s data collection initiatives are aligned with its strategic interests.

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references

[1] Marr, B. (2010). How to design Key Performance Indicators, Management Case Study, The Advanced Performance Institute (www.ap-institute.com). pp.4-5
[2] Marr, B. (2010). How to design Key Performance Indicators, Management Case Study, The Advanced Performance Institute (www.ap-institute.com). pp. 7
[3] Marr, B. (2010). How to design Key Performance Indicators, Management Case Study, The Advanced Performance Institute (www.ap-institute.com). pp. 9
[4] Marr, B. (2010). How to design Key Performance Indicators, Management Case Study, The Advanced Performance Institute (www.ap-institute.com). pp. 7-12
[5] Marr, B. (2010). How to design Key Performance Indicators, Management Case Study, The Advanced Performance Institute (www.ap-institute.com). pp. 7-12