It is said to improve something, you need to measure it. BSC evaluates key performance indicators (KPI) to measure progress towards achieving the company's strategic goals. Accordingly, if the selected metrics originally unrepresentative, the results of the evaluation is not much help to managers. Thus, the establishment of key performance indicators is perhaps the main stage in the successful implementation of balanced scorecard. Selecting KPIs – the process is quite complicated and tedious at times. And then the leaders admit many mistakes, which, however, differ in uniformity.
Consequently, these errors can be avoided. Moreover, it should be done if the company really looking forward to the successful implementation of the MTP. We should not expect any positive results have been, if the metrics are chosen correctly. Key indicators efficiency – not just the numbers and value. From these numbers change depending welfare of the company. However, if the numbers are "disconnected" from reality, then they will only figures that give the top management in misleading.
So, if you select the wrong metrics, executives are confident the right course business entrusted to them, but eventually it may be that contrary to the direction of the strategic objectives. So, on paper it looks great, while in reality, the company repeats the tragic path of "Titanic." What we need to know about key performance indicators? First and foremost – that's what the metrics should display the key success factors. For example, if your company is engaged in the wholesale, the KPI relating to sales, will be the most weighty importance. If the metrics do not represent the most important processes within and outside the company, from the MSP will be no good. It is important to note that the correct choice of the ECP is not guaranteed success in the implementation of the MTP. Each category of indicators should have a so-called "share". In other words, some indicators are more important than others. On what does depend on these priorities. First of all, the strategy of the company and its trouble spots. For example, if a company is having problems in relationships with clients, performance category of "Market. Customers "will be more important than the category" Internal business processes. " Too much attention on secondary indicators will have negative consequences for operation of the MTP. Often in the pursuit of success as top managers of the system overload indicator that the operation of CSP is transformed into a daily headache for all companies. Ordinary employees are not just understand the essence of the MSP, and do not have enough time to make timely data into the system. Therefore, the optimal number of indicators – a necessary condition for success. How many indicators recommended for use in implementing the MSP? Each level of management should have its own set of indicators, whose number should not exceed 10-12. More KPI overload the system. Moreover, it will be very difficult analyze data and identify key components of success in specific markets. Performance indicators should be understandable to ordinary members, or turn into a bunch of MSP unnecessary charts, tables and documents. If the employee understands their contribution to the company and the achievement of company strategic goals, motivation will increase, thus enhancing the efficiency of the entire company.