Key Performance Indicators

Sometimes innovators get bogged down in the available data, measuring metrics that do not create optimal value. It is crucial to measure the metrics that are valuable to the customer and help to tell the story of the innovation. These are the key performance indicators.

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There are three distinct types of performance indicators to consider. First are the well-known key performance indicators (KPIs). However, the traditional key performance indicators are not always crucial to performance. 

Key performance indicators are crucial to the success of a product or solution.

KPIs are the metrics that will make or break the product or solution’s success. These metrics can and do vary depending on the stakeholder. One must consider all perspectives; what is surprising is the level of overlap between stakeholders.

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One level lower than KPIs are performance indicators. Performance indicators are the data points that combine to create key performance indicators. Identify three performance indicators that allow for proper measurement of the KPIs.

Performance indicators typically provide the subset of data necessary for KPIs

Performance indicators are nice to know. However, they do not determine success individually. These indicators can be deceiving; they may feel like KPIs but are not. It is crucial to distinguish between performance indicators and KPIs to assess the value of the product or solution.

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Lastly, and the least valuable set of indicators are called insights. In a way, they are somewhat useless. In the world of big data, these are the most common sets of data available. Insights are intriguing but create no value in determining the success or future development of the product or solution.

Do not get bogged down by insights. Some stakeholders will ask about these, even if worthless. Usually, personal agendas cloak insights as performance indicators or, worse, key performance indicators. Avoid this trap at all costs. 

When innovation gets trapped in the insight web, it is hard to get out without resetting priorities. Reporting on these metrics clutter the story and hide the valuable KPIs from easy view.

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I developed a strategy to establish KPIs easier and more efficiently. It considers all stakeholders and different personas critical to differentiating the three indicators and allows individuals with diverse perspectives to collaborate around the process in an impactful and easy way. Send me an email to learn more.