Introduction to davids book “Key Performance Indicators for Government and Non Profit Agencies

During workshops which I deliver I have been asked by attendees from government and non profit agencies (GANPA) “Will winning KPIs work for us?” they ask. The answer is a profound “yes”. Finding your winning KPIs will create much benefit . By embedding ‘winning KPIs’ Government and Non Profit Agencies would benefit from:

  • knowing their critical success factors (CSFs) and conveying them to all staff
  • more widespread empowerment and more clarity on what should be recorded and reported
  • CEOs, both current and future, connected to staff who are working in the CSFs e.g., there will be daily follow-up calls on the KPIs; and
  • Staff’s daily activities linked to the strategic direction of the organization.
Even though an organization has a strategy, teams are often working in directions very different to the intended course as shown in Exhibit 1. If the CSFs of the organization are clarified and communicated, staff will now be able to align their daily activities closer to the strategic direction of the organization as shown in Exhibit 2.

Exhibit 1:The impact of winning KPIs to the daily routine and tasks performed by staff

Exhibit 1: Before winning KPIs Exhibit 2: After implementation of winning KPIs
csf-exh1-1 csf-exh1-2

The process is relatively simple and will take between 6 to 16 weeks of elapsed time depending on the size of the organization. The process I recommend requires an understanding of four types of performance

measure, namely:

  • key results indicators (KRIs) – six to 10 financial and nonfinancial monthly or quarterly measures giving an overview of past performance;
  • performance indicators (PI) – 30-50 non-financial daily, weekly or monthly measures telling staff and management what to do;
  • results indicators (RIs) – 30-50 financial and non-financial daily, weekly, monthly or quarterly summary indicators telling staff what they have done; and
  • KPIs – six to 10 non-financial measures telling staff and management what to do to increase performance dramatically, measured 24/7, daily or weekly.
Other requisites are:
  • selling the project to the CEO as the most important thing the organization can be doing at this time;
  • <laying, and building upon, the project’s seven foundation stones, see Exhibit 3.
  • having a balanced view of performance (ie the six perspectives of the balanced scorecard – financial, internal process, customer focus, employee satisfaction, innovation & learning and growth, environment and community);
  • locating the five to eight CSFs which have the greatest influence (out of the organization’s 30-plus success factors);
  • finding measures that will drive the appropriate behavior within the CSFs and SFs;
  • working with measures relating to activities past (last week,last month), current (yesterday and today) and future (the scheduled dates of key tasks); and
  • ensuring the right ‘timing’ for freeing resources to complete this task.

Exhibit 3: The seven types of performance measures

perf_mes

External advisers and internal resourcing

In implementing winning KPIs, an SME may need to rely on an outside professional adviser – e.g., a trained business coach, or the business’s accountant (if they have trained themselves in this area). However, while this adviser must work closely with the in-house resources chosen to run the project, they must not drive it (since that could lead to a lack of internal ownership).

It is also important that the project does not fail through lack of resourcing or of management attention.

Further Reading and references

This article is a very brief introduction into a methodology that will leave a lasting legacy in your organisation.

  • Key Performance Indicators: developing, implementing and using winning KPIs, David Parmenter, Wileys. 2010
  • Key Performance Indicators for government and non profit agencies: implementing winning KPIs, David Parmenter, Wileys. 2012.
  • www.davidparmenter.com for checklists and templates from my books
I wish you well with this project and please do let me know when it is imbedded and working.

This piece is an introduction to davids book “Key Performance Indicators for Government and Non Profit Agencies

For more information access David Parmenter’s white papers that contain his latest thinking along with supporting electronic media to get you started.