The Importance of Proper KPI Process Analysis

Key Performance Indicators (KPI) are defined as the values, measurements, or metrics that are used as bases in order to pave the way for the attainment of the important objectives of an organization, company, corporation, or association. These are of great importance to a company in order for the management to fully understand and implement measures to improve company performance. This is the reason why the management or the concerned department of the corporation must be knowledgeable about KPI Process Analysis.

There are numerous questions about what would happen to the company if the key performance indicators are not properly obtained and analyzed. However, the question of what would happen to the company if these performance indicators are properly obtained and analyzed poses a much more important query.

There are two categories of performance indicators that the company may be concerned about: good performance indicators and bad performance indicators. Good performance indicators must always involve the totality of a company’s functions, processes, and activities. A bad performance indicator will leave one out, giving the evaluator an incomplete view of the entire picture, so to speak. Proper analysis of performance indicators will encourage the consideration of all the aspects of the existence of the company, and not mere book values, such as increased sales, revenue, and the like.

The proper analysis of a good performance indicator will result in the proper evaluation of company performance. This will, in turn, result in the formulation and enactment of guidelines, adjustments, policies, regulations, and such other changes, which are designed to enhance company productivity. Should company performance be evaluated as excellent or at least satisfactory, the management may even be encouraged to grant certain gratuitous benefits, privileges, and bonuses for their employees and the other members of the organization. This particular result will surely increase the morale of the personnel and will likewise increase their dedication and perseverance to further aspire for good company performance.

Proper analysis will also allow all employees to work together as if every company function is a group-oriented activity. This is because the employees will also come to know what aspects of their performance add to the success of the company. With high morale and a good sense of cooperation, the employees may be easily encouraged to work together for their own benefit and for the benefit of the company. Proper, standardized, and reliable metrics will also be produced with the proper analysis of key performance indicators. This is so because the values obtained will more or less be the standard with which other values will be compared. A high similarity will mean that the company is doing well, even better if the latter value surpasses the former value. Adversely, a low similarity will mean that the company is not doing very well in its performance and that there must be something wrong within the company structure. The same measures previously implemented may then be re-implemented, or an entirely new set of measures may be imposed.

The importance of proper KPI Process Analysis cannot be discounted. A company cannot be expected to survive the global environment if its performance indicators cannot be properly obtained and analyzed.

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