kpi

KPI’S – The Business of Lying

KPI: Key Performance Indicator

In our current business environment, it is very common to want to parameterize to the absolute limits the functionality of an organization. The implementation of business software that provided the famous BALANCED SCORECARD proved to be a great business enterprise.

These balanced scorecards allow users to understand the situation of a business in a single click, and practically allow users to hire and fire people thanks to the evolution of the software.

The problem is the correct definition of the indicator, but that does not matter. The important thing is to complicate things as much as possible adding a large number of parameters and change data so that it looks like the results improved.

We have seen companies with constantly improving KPIs begin to suffer losses and not know how to attack the problem. There is no worse thief or scoundrel than someone who is selling fake compasses. These consultants have done great damage to other companies and their lack of involvement has destroyed customer confidence in a service that can offer great value.

The worst part of it is the large number of people that live within these parameters; those doing “data reporting”, “analysts” and “controllers”. People maintaining ERP’s etc. Investment in the area of CONTROL (Check) of Deming’s Circle is taking a huge amount of resources. One of the basic principles is that the measurement tool does not impact the measurement and personnel costs are very high. This cost and impact should always be analyzed.

DEMING

Before applying all of the parameters, we must consider what we want to measure and define the indicator that reflects it.

What is the objective of a company? That is the first thing we must have clear.

Published by La Verdad

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