Building our performance indicators

A piece of information that shows the result of activities carried out by an organization in the past is called a performance indicator.

Why measure?

By measuring our activities we can know and quantify their results and status. Then we will know which activities we should improve in order to achieve established objectives.

For what purpose?

  • To interpret what is happening in the organization.
  • To have a historical record of the results of the organization’s activities.
  • To be able to introduce improvements in the organization’s activities.
  • To know the variables and take measures when they exceed established limits.
  • To know the relationship between productivity and salary.
  • To know the relationship between productivity and profitability.
  • To know the company’s risk situation.
  • To focus financial plans and refocus them when they don’t go as expected.
  • To know the basis of strategic development and the potential application of an improvement focused on the organization.

Purposes of performance indicators

The objectives of a measurement system using indicators are:

  • To improve control over the company.
  • To provide information on the strategy.
  • To provide information on the goals.
  • To measure behavior in the organization.
  • To analyze and understand processes.
  • To diagnose problems.
  • To identify opportunities and problems.
  • To identify initiatives and actions required.
  • To define functions and responsibilities.
  • To facilitate empowering people.

These objectives should be in line with the company’s strategies, actions and results.

 Methodology for building indicators

  1. What is done?

Activities that take place in the organization are measured.

  1. What is to be measured?

Activities considered high priority. A valued relationship is established (from 0 to 100, for example) for the purpose of prioritizing the organization’s activities.

  1. Who will use the information?

Once the activities have been measured, the users of the information are selected. Access to this information substantially depends on who will be using it.

  1. How often?

In this phase, the frequency with which the information will be needed, which depends on the type of activity and the user of the information, should be specified.

  1. With what or whom will a comparison be made?

Lastly, “references,” which may be internal or external and will serve for making comparisons, must be established with regard to the structure, process and result.

Phases of the development and establishment of performance indicators

It is essential not only to obtain the expected results, but also to obtain them using the best, most economical method.

Do the right thing: Delivering products with the characteristics requested, in the exact number, on time, at the agreed place and price leads to total customer satisfaction with the product delivered.

The right way: Doing things correctly is a matter of always using the best methods; “being efficient” is using available resources in an optimal manner.

The best performance an organization can achieve is that obtained by doing the right thing in the right way, which is both effective and efficient.

Autor: Dante Merino La Rosa

Deja un comentario

Tu dirección de correo electrónico no será publicada. Los campos obligatorios están marcados con *

Scroll al inicio
Abrir chat
¿En qué podemos ayudarte?