KPIs That Do Work

From strategy to execution: how performance indicators can help

A common pitfall for organisations is that they – albeit often unknowingly and with the best intentions – create barriers for a successful execution of their strategy by implementing conflicting Key Performance Indicators (or KPIs). This comes at the expense of customers and fixing the mistakes takes a lot of time, effort, and money. KPIs don’t generate the desired performance improvement and the daily delusions continue to rule the organisation. But working with KPIs can have a different result.

In Winning With the Right KPIs, iPM founder and former Performance Manager at Royal Philips Electronics, Peter Geelen shares practical insights to use KPIs effectively and describes an innovative approach that has been battle-tested and proven successfully in practice for more than 15 years. You learn how to set up KPIs that really do improve collaboration, customer value and customer service, and give you buttons you can truly press to realise the ambitions, goals, and dreams of your organisation.

“This book is a page-turner, and recognizable for organisations of all sizes. A must-read for every manager who wants to put ambition on paper but also truly wants to realise it. You will be guided step-by-step to learn how the organisation can work in teams on real improvement.”

Leonard Geluk, Chairman of the Board of Directors of The Hague University of Applied Sciences.

“This easy to read book is important for anyone who doesn’t want to get caught up in the daily delusions and does not want to lose sight of the customer!”

Rob Scholte, former Executive Board and Board Member at Metro, Goodyear, Nestlé, and Unilever.

“We have been working with iPM since 2010 and we have realised significant improvements in results in failure costs and lead times. Customer satisfaction has also increased significantly!”

Piet van Loenhout, Managing director of Berkvens door systems.

About the Author

Peter Geelen is the founder of the integral Performance Management® method. Peter worked on Performance Management for Philips and worked with and for Cor Boonstra, Jan Hommen, and Gerard Kleisterlee, among others. Peter wanted to break through island thinking in organisations at all costs, and he designed and developed the iPM method and perfected it over the last fifteen years into a successful method and consultancy agency iPM Partners. Peter is the author of several books and many publications on Performance Management. He is a guest lecturer at Maastricht University, speaker, and sparring partner for management teams and organisations. He still cares about the results of his customers.

For more information www.ipmpartners.com

Inhoudsopgave

INTRODUCTION 9

1 DON’T MAKE A FALSE START WITH YOUR KPI PROGRAMME 15

2 DAILY DELUSION RULES YOUR ORGANISATION 21

3 LESS IS MORE 27

4 A KPI LIST IS USELESS 33

5 THINK IN CUSTOMER CHAINS AND PREVENT ‘ISLAND THINKING’ 39

6 IS PLANNING & CONTROL BECOMING OBSOLETE? 45

7 KING-SIZE PERFORMANCE INFARCT 51

8 THE MANAGING DIRECTOR INTERVENES 57

# AVOID THE 5 PITFALLS OF THE TRADITIONAL KPI STRUCTURE 63

9 GETTING STARTED WITH DREAM AND GOAL (THE ‘WHY’ AND ‘WHAT’) 75

10 GETTING STARTED WITH CUSTOMER CHAINS (THE ‘HOW’) 85

11 CUSTOMER VALUES AND INTERNAL VALUES 93

12 LINK PROCESS KPIs TO RESULT KPIs 99

13 COMPREHEND YOUR PROCESS BEFORE DEFINING THE OTHER PROCESS KPIs 107

14 SEE THE FOREST AGAIN THROUGH KPI TREES 115

15 KPI BUTTONS YOU CAN TRULY PRESS 123

16 THE RIGHT CHART INSPIRES THE RIGHT BEHAVIOUR 131

17 PUSH VERSUS PULL 137

18 WHO MANAGES WHAT? 141

19 THE PERFORMANCE REVIEW CAN START 149

20 DAILY DELUSION NO LONGER RULES YOUR ORGANISATION? 157

APPENDIX: eHOMES ORGANISATION CHART 165

ABOUT THE AUTHOR 169