Key Performance Indicator (KPI) Boards (Part 1)

It may be hard to think of a less inspiring title for a Blog, but KPI Boards are HUGE in taking your process to the next level, and I’ll explain how to use them in just a second.  First, however, let me stipulate from the beginning that they can work for everyone, every business, every discipline.  In fact, for a firm to really make things click, you all have to be using them.

Alright, what’s a KPI board?  It’s literally a board.  Whether a fancy cork board or humble piece of plywood, its mounted in the area of the organization it reports on.  It is used to display the health of that organization.

How do we measure the health of an organization?  We post our daily or weekly performance against the metrics cascaded down to that organization from the mission statement.  

In my Blog about Hoshin Kanri (Leading Change at the Speed of Electrons (Part III)), I spoke about the leaders of an organization gathering to agree on what promises the firm’s Mission Statement made and what unit of measure they’d use to determine how they were doing against each.  The senior leaders then posted their own performance and cascaded the metrics down into the organization.  These, then, are the metrics we’ll be tracking on our KPI boards.

I strongly encourage practitioners to post their performance using Run Charts.  Why Run Charts?  Because they examine performance trends over time.  Examine the chart below.  What can we learn from it?

1st - We Understand one of the key things important to this group: First Pass Yield.

2nd - We learn what the goal is that’s been established for the group.

3rd - We can see that the group is improving.

4th - We can see that the group is stagnating just shy of the goal.

Okay seeing this chart, if you were the manager to whom this group reported, what have you discovered?  You’ve discovered that this group has hit a wall and that they need help to get past it.  Does your involvement end there?Absolutely not.  Do you need to lecture the group, or "encourage" them?  Absolutely not.  Ah, your job is to flog them, then, right?  NO WAY!

Your job is to get them to ask for what they need, or go ask them, then find a way to meet their need.  If that’s a new behavior for you, eliminating obstacles, it needs to become an important part of the way you manage in the future.

Here’s a takeaway.  The way to make the KPI board work is to review it often.  So what’s often?  If you’re a VP, you should be visiting your Directors’ boards weekly.  Directors, you should be reviewing the boards of your Managers at least once a week.  If you’re a Manager, you should be reviewing your Supervisors’ boards daily.  If you’re a Supervisor, you should be visiting your Lead persons’ boards hourly.

In my next post, I’ll talk about what you’re going to be looking for and what action your going to take as a result.

Until next post, Get Lean, Stay Lean.  Feel free to drop me a line at: robert@gettingtolean.com