Don’t create KPIs. Go for Key Performance Questions instead, as Harvard advises.
The recent Harvard Business Review article How to Make Sure You’re Not Using Data Just to Justify Decisions You’ve Already Made has a very good advice on how to avoid implementing non-relevant KPIs for your business and how to set up a winning data driven strategy.
Data is key in today’s big and small businesses. However, you cannot simply rely on it alone. In order to be successful you need to have clear goals and definitions, backed by data.
As concluded also in another HBR article Big Data: The Management Revolution: “Companies succeed in the big data era not simply because they have more or better data, but because they have leadership teams that set clear goals, define what success looks like, and ask the right questions.”
Defining the Key Performance Questions will help set the overall strategy for your business and make sure that the performance measurements bring the best insights for you.
In the article, four steps are given as examples of how data driven KBQs are best defined in order to guide your decision-making instead of justifying it:
Define your purpose
Immense yourself in the data
Generate key business questions
Prioritize your key business questions
Don’t rely on standard KPIs to measure your business. Go for data driven KBQs from the very start, so that you can have the best measurable performance goals. Make sure you go through the HBR article for more detailed information.