KPIs 5: QUICK IMPROVEMENTS

 

This is more than just the involvement of lots of people in the front line. Their involvement is a vital ingredient but it is only part of the process.


KPIs can be of great value if they GENUINELY motivate and guide people to quick action.

There are certain examples of measures/KPIs which can be very powerful in causing action. Unfortunately they can also be the kind of figures which we shy away from and hesitate to report because WE FEEL they may be negative. There will probably be a number of examples of such in every organization. If you can pull out this kind of information and turn the human side into a positive rather than a negative, there is every reason why it should lead directly to corrective/improvement action. Essentially these KPIs are to do with simple errors, waste, shortfall. I call them foot-shooting, i.e. shooting yourself in the foot.

Generally speaking what makes a good ‘front line KPI’?

  1. One which shows at a glance, to the right people, where the action is needed
  2. Which can people can begin to address quickly
  3. Which actually goes to the root of the frustration in peoples’ working day, so that they would be keen to remove the frustration.
  4. One which is specific, focused and easily understood

Here are some of the more common examples:-

In Sales and Marketing

  • Failing to follow up leads within a reasonable time
  • Failing to follow up a quote promptly in order to be able to ‘negotiate’ and then finding out when you did follow it up that it was too late
  • Time wasted visiting a prospect and finding out when you get there that it was a waste of time, for some reason which could have been discovered on the phone
  • Poor contact management (CRM) practice leading to lapsing of customers because you did not keep in touch

In Finance

  • Bad debt because the sales department continued to trade when not realizing that a customer was way overdue with payment
  • Having to issue a credit note because the invoice was wrong (this may not lose money but it costs effort and dissatisfaction)

In Operations

  • Issuing the wrong specification to production
  • Supplying the wrong item to a customer
  • Lots of avoidable operator errors caused by poor training or poor briefing
  • Process breakdowns which happened because no attention was paid to a reported fault

I believe all of these are eminently preventable by good basic practice, but if they are happening, dealing with them may feel a bit tricky. So how do you approach this?

These may be cross functional issues/blind spots

You may ask, if they are so obvious, why have they not been fixed? The answer may be that correction needed in close collusion of front line people in several functions of the business. This means approval at high level and action at low level. It means shifting the input on a blind spot.

Management attitude is very important in this-no blame.

I see nothing wrong in producing information on foot-shooting for the people in the front line, provided that the information is not used to beat people or attribute blame. The management ‘line of approach’ that must go with this information is ‘what’s wrong, not who’s wrong?’ and ‘how can we stop that happening again’

If you first identify the kinds of foot-shooting that may happen, it makes good sense to measure it for a period of time, if only to quantify the extent of the problem and get commitment to doing something about it. You may have to spend money (on training, for example) to fix the problem. So don’t just say ‘we know what the problem is, so we don’t need to measure’. You DO need to know how much of a priority it is.

Team culture

Really you are trying to foster an open culture, encouraging professionalism and attempting to do the simple things right. Although it may seem controversial and a bit threatening to talk openly to your people about foot-shooting it almost always produces great attitude from people, because admitting simple errors gives people a good self image. This could otherwise be described as taking responsibility for actions, as a team. Far better to do that than to have top management mumbling and complaining in the corridor in a resigned and defeated manner. Get it in the open and deal with it, we all make mistakes.