KPIs, Targets or Initiatives – Which Comes First?

February 5, 2013 by Stacey Barr

A weird thing happens in many organisations’ planning processes. They choose their strategic goals, then their strategic initiatives, then targets and then the KPI or performance measure. Often, there won’t even be a KPI or performance measure until after the plan is published.

It’s weird because logically you cannot choose a target until you know what you’re measuring. And yet, most business plans I’ve seen ignore this simple logic and are laid out something like this:

Goal Initiatives Target KPI
Enhance efficiency of recruitment Educate recruitment officers 100% Recruitment Efficiency

How, for example, can you set a target for the efficiency of recruitment until you have decided how to measure that goal? Saying that your target is a 10% improvement is stabbing in the dark.How do you know that 10% is too much, or not enough of an improvement? You don’t know the measure yet so you don’t know your baseline, where you’re starting from.

Saying that you want performance to be 100% is just as ludicrous. One hundred percent of what, exactly? And do you know what sustaining that level of perfection is going to demand in effort and investment?

It’s much more sensible to set a target after you’ve decided that the best measure is Average Days to Fill Vacant Positions, established that the baseline is 93 days and in order to meet other business goals it really should be reduced to 45 days. A target of 45 days for Average Days to Fill Vacant Positions is now a much more meaningful target.

The more logical and useful and effective order to lay out a strategic or any plan is results, measures, targets, initiatives:

Reduce waiting time for approvals by simplifying authorisation protocols.

Goal KPI Target Initiatives
Enhance efficiency of recruitment Average Days to Fill Vacant Positions 45 days Reduce waiting time for approvals by simplifying authorisation protocols.

TAKE ACTION:

There are two things to do: Firstly, review your planning process to make sure it’s not allowing initiatives and strategies to be chosen before you first have measures for your goals or objectives. Secondly, modify the layout of your plan so it makes more sense. You can find a template to get you started at //www.staceybarr.com/measure-up/54-the-5-essential-parts-of-a-dust-repellent-strategic-plan/.

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