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The New Thinking on KPIs, part 2 of 4

The characteristics of KPIs

KPIs represent a set of measures focusing on those aspects of organizational performance that are the most critical for the current and future success of an organization. There are only a few KPIs in an organization (no more than 10) and they have certain characteristics.

KPI characteristics include:

  • Non financial measures (not expressed in $s, Pds etc)
  • Measured frequently e.g. daily or 24/7 (KPIs are not measured monthly)
  • Acted upon by the CEO and the senior management team on a daily or 24/7 basis
  • All staff understand the measure and what corrective action is required
  • Responsibility can be tied down to a team
  • The KPI has a significant impact on the organization e.g. it impacts on most of the critical success factors and balanced scorecard perspectives
  • Positive movement affects all other performance measures in a positive way

When you put a Pound or Dollar sign to a measure you have not dug deep enough. Sales made yesterday will be a result of sales calls made previously to existing and prospective customers, advertising, amount of contact with the key customers, product reliability etc. I label any indicator expressed in monetary terms as result indicator, see below for more explanation.


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About the Author

David Parmenter, author of Key Performance Indicators: Developing, Implementing, and Using Winning KPIs and Pareto’s 80/20 Rule for Corporate Accountants, is an international presenter who is known for his thought provoking and lively sessions, which have led to substantial change in many organizations. He is a leading expert in developing winning KPIs, replacing the annual planning process with quarterly rolling planning, accelerating month-end processes, and converting reporting to a decision based tool.

David’s work on KPIs has received international recognition with clients in Auckland, Wellington, Sydney, Melbourne, Brisbane, Adelaide, Canberra, Perth, Kuala Lumpur, Singapore, Tehran, Prague, Dublin, London, Birmingham, Manchester and Edinburgh. David is a fellow of the Institute of Chartered Accountants in England & Wales and has worked for Ernst & Young, BP Oil Ltd, Arthur Andersen, and Price Waterhouse Coopers.

David’s recent thinking is accessible from www.davidparmenter.com. He can be contacted at [email protected] or telephone +64 4 499 0007.

This articles is an extract from his “Implementing winning KPIs” whitepaper which can be downloaded from http://davidparmenter.com/how-to-guides)

How to Lead An Online Business

First and foremost, find an idea you love.

Whether it’s ice cream, bean bags, or shirts with funny slogans, find a product or service you’re passionate about selling. I started my career as a marketing executive. One day, I was invited to dinner with Japanese business associates. The dinner was a great success, and afterwards we moved to a Japanese tea house where, following tradition, everyone removed their shoes. I looked down, and I had two different socks on – one with a hole in the big toe. I sat cross-legged for an entire evening, trying to hide my foot. I’m passionate about helping executives avoid such embarrassments by allowing them to buy fine-quality essentials in one convenient place online, and have them delivered to their doorstep. Because wouldn’t it be wonderful if your sock drawer could replenish itself?


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About the Author

Samy LiechtiFollowing his studies of economics and business administration at the University of St. Gallen, Paris and Toronto (earning the title of lic. oec. HSG in 1993) Samy Liechti was a marketing and communications consultant for various agencies in Switzerland and abroad, working with numerous prominent brands. Samy Liechti has been Blacksock’s managing director ever since its foundation in the summer of 1999.

Be a GPS System for Change

As change agents, we find ourselves regularly challenged to get the buy-in and follow-through we need. We often start with a great premise and desired outcome, but few tools to enlist the necessary buy-in.

Two things must happen before change will occur:

  • the people in a system must recognize, manage, and buy-in to all the elements of the suggested change,
  • the system must comprehend that a solution will maintain the integrity of the whole.
Dirty Little Secrets: Why buyers can’t buy and sellers can’t sell and what you can do about it
by Sharon Drew Morgen

 

Every day, business people face critical buying decisions – from new software to revamped website design to employee training programs. But all too often, the long lag time between recognizing the need for a new solution and actually purchasing and implementing it leads to lost sales, lost opportunities, and lost productivity. Thought leader Sharon Drew Morgen has uncovered what keeps organizations from moving forward and in her new book, Dirty Little Secrets, she reveals what potential buyers need to know to expedite the process of bringing positive change to their companies.

Dirty Little Secrets offers dozens of examples to clarify precisely how buying decisions can be facilitated through the right kind of questions, including an in-depth case study of a marketing manager who recognizes the need for a better website and wants to bring in an external design team. Sharon Drew explores what happens when he stumbles in the dark trying to bring his fellow managers, the internal tech team (which is responsible for the current site), and the CFO (to whom the tech team reports) on board. She then presents the same situation using Buying Facilitation®. The result? “Decision facilitation” enables a smoother, faster process that leads to a better outcome for both the marketing manager and the design firm.

Unfortunately, we’ve never been taught how to help manage the behind-the-scenes – and often unconscious – issues necessary to create and maintain systemic change. We’ve operated on the assumption that with a rational initiative and good communication folks will know how and why to adopt the change – and if they don’t, we handle their resistance.

I suggest there is a more effective way to be successful: become a GPS system and lead the change from the inside out.

Be the GPS System, Not the Consultant

During change initiatives, we often don’t manage the unconscious issues that underlie the status quo and will shift during change. People will take no action – or will resist any request for change – until they address these in a way that maintains internal congruence. But because they are often hidden, we tend to ignore them until it’s too late.

Before designing a change initiative, we need to:

  1. understand the details, associations, and historic import of the internal systems issues that created the problem that will be changed,
  2. figure out how it has been maintained and held in place daily,
  3. recognize the new rules, roles, and relationships that will emerge post-change,
  4. help folks manage the differential in their beliefs between who they are now and who they will be, to help them accept change on a personal level first.

When we attempt to use negotiation skills or OD skills at the wrong time in the change cycle – and almost all change agents attempt to get folks to agree to change well before they have figured out their personal routes through their change issues – we are delaying the change and opening up the possibilities for rejection and sabotage.

Current strategic change models only manage the ‘push/information’ half of the change process. Let’s add a ‘pull/buy-in’ skill set.

To ensure buy-in to change, become a neutral GPS system to navigate followers through the old and new systems issues that will shift, and help them create their own new rules, roles, and relationship patterns.

Help them develop the sort of environment that will both match the change and manage the personal, idiosyncratic elements that have made the folks successful in their pre-change situation.

As part of your new GPS skill set, become a decision facilitator and lead change where it begins: within the system that created the need for change to begin with, and through the people who will be leading the charge.


About the Author

Sharon Drew Morgen is founder of Morgen Facilitations, Inc. (www.newsalesparadigm.com). She is the visionary behind Buying Facilitation®, the decision facilitation model that enables people to change with integrity. A pioneer who has spoken about, written about, and taught the skills to help buyers buy, she is the author of the acclaimed New York Times Business Bestseller Selling with Integrity and the new book Dirty Little Secrets: Why buyers can’t buy and sellers can’t sell and what you can do about it. She lives in Austin, Texas.

Decision-Making Best Practice 8 – Observe the Opportunity or Problem First Hand

StrategyDriven Decision-Making ArticleEvery problem possesses unique nuanced qualities and it is often these minor details that renders a decision a striking success, a monumental failure, or, most frequently, simply average. Those who recognize these details can exploit them to their organization’s advantage.


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The Ladder of Commitment

Are you going to achieve your most important targets for the coming year?

Your answer to that question can reveal a lot about where you are on what I call “the Ladder of Commitment “, and is generally highly predictive of how far you’ll go in your pursuit of success.

Here’s a quick look at that ladder from the bottom up, along with what may be a surprising conclusion about what it really takes to reach your targets, in business and in life…

1. Helplessness

Years ago, scientists did an experiment on lab rats that involved dividing a metal cage into four sections and placing electrical current underneath each section. When a section of the cage was filled with live current, the rat would receive a small shock if stepping into that part of the cage. Quickly, the rat would learn to avoid that section.

Over time, each section of the cage was electrified in turn, leaving only one quadrant of the cage as a ‘safe haven’ for our experimental rat.

What happened?


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About the Author

Michael Neill is an internationally renowned transformative coach and the author of the new book, Supercoach: 10 Secrets to Transform Anyone’s Life. For the past 20 years, he has been a coach, adviser, mentor, and creative spark plug to celebrities, CEOs, royalty and people who want to get more out of their lives. He hosts a weekly talk show on HayHouseRadio.com, and his daily and weekly coaching columns can be read on his website www.geniuscatalyst.com.