Key Performance Indicators (KPIs) measures the success of an activity. It can be used mainly on two bias: strategic or operational. Based on the KPIs, executives can visualize performance changes of the company, identify bottlenecks and correct decisions impacts, and keep on improving the organization processes and functioning.
Identifying the right metrics and the reflection and impacts of changes can be hard. There is not a primary or starter list of KPIs; they relate substantially to each type of business.
Allowing companies to make use of real data information, is to amplify the vision and enable critical business decisions to be made based on facts, not merely on opinions.
Some real examples of KPIs are:
- How many active customers do you have?
- How much do they spend on your products per month?
- How long do you take to deliver your product?
The three KPIs above already helps managers on conclusions like:
- Should I add more members to this group staff?
- What product is my most profitable?
- In which product should I invest next?
Defining which KPIs should be monitored is one of the responsibilities of the business team. Additionally, the tech team is responsible for providing practical solutions to automate the collection, measurement, and presentation of it, allowing the biz team to spare more time with analysis and decisioning.
Business Automation tools support accurate monitoring and reporting of KPI’s. It allows aggregating the necessary information from different data sources and presenting them in friendly dashboards with graphics and tables.
During the digital transformation journey, emphasize the work executed over the KPIs. Their analysis is the task which provides a solid base for finishing a BPM cycle and start improvements and implementation over running processes.
Business Activity Monitoring
Nowadays, IT is a crucial component of the BPM and Lean implementation due to the outcomes that technology has to provide to the BPM practice. The application of the mentioned concepts about KPIs can be done by using Business Activity Monitoring (a.k.a. BAM) – a feature provided out-of-the-box by business automation tools.
|Business Activity Monitoring is a term introduced by Gartner in July 2001. Gartner defines BAM as the usage of processes and technologies that amplifies perception and allow the analysis of critical business information based on real-time data|
This feature allows the creation of user-friendly dashboards that report business activity, KPIs in a graphical way, business risks, and performance. Additionally, some business tools can aggregate information from external systems to match other business related information.
The managers and business team will consume the dashboards created by the application team: during the design phase the architect will define data integration with external systems, and during the development phase, developers, and analysts will implement the reports.