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KPI models
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There are two possible objectives for your KPI Model.
There are two options for your first business model; you cannot achieve both objectives with the same model.
1. Model your present business structure and strategy.
This is the usual starting point, and you should choose this if you are happy with your business and want to fine tune its performance.
2. Search for a new strategy.
Choose this if your business direction needs to change to capture a new opportunity or to follow a market shift. I find that people often move to this approach after they have examined the status quo, finding that this first step triggers an alternative view.
This leads you to differentiation of your strategy and enables you to test its feasibility before you take a risk.
The Levers of Productivity
Click on the title to download this introductory paper free of charge.
Every business activity has to generate a benefit to the business; if it does not I suggest you change it or stop doing it. The implication is that you need to measure the productivity of a number of activities so that you can measure and improve their profit contribution. These are your KPIs and they are the levers of productivity in your business. The paper explains the principles of productivity KPIs and the concept of operating ratios.
Setting a profit goal does not produce profit; managing the activity that produces the profit is what really counts.
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