What Is a Performance Indicator?

Performance indicators are factors used to judge the performance of an object (individual, business unit, department or organization). Key elements of performance evaluation. Reflected by behavioral indicators and outcome indicators. Behavior indicators refer to the behavioral performance of employees in the workplace; outcome indicators refer to certain changes in work and organization brought about by employees' work. ^[1]

Performance indicator

Performance indicators are factors used to judge the performance of an object (individual, business unit, department or organization). Key elements of performance evaluation. Reflected by behavioral indicators and outcome indicators. Behavior indicators refer to the behavioral performance of employees in the workplace; outcome indicators refer to certain changes in work and organization brought about by employees' work. ^[1]

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The extraction of KPI indicators can be summarized in a sentence of "cross focus, responsibility correction". However, in the specific operation process, it is not an easy task to decompose from vertical strategic goals at all levels and horizontally extract the ten from business processes. The following describes the extraction process of KPI indicators through Figure 3-1.

Decompose the company's strategic goals, analyze and establish the links between the sub-goals and the main business processes. Generally, an enterprise's overall strategic goals can be broken down into several main supporting sub-goals, and these supporting more specific sub-goals themselves need the support of some of the company's main business processes to achieve a certain degree.

Determine the goals of each supporting business process. After confirming the supporting business processes for each strategic sub-goal, it is necessary to further confirm the overall goal of the process itself under the premise that the strategic sub-goal is supported, and use the method of the Jiugong diagram to further confirm that the overall goal of the process is in different dimensions Detailed breakdown of the content.

Confirm the contact between each business process and each functional department. In this link, the relationship between processes and work functions is established by means of the Jiugong diagram, so as to establish the relationship between processes, functions and indicators at a more micro-departmental level, and establish a link between the overall strategic goals of the enterprise and the department performance indicators.

Extraction of department-level KPI indicators. In this section, the KPI indicators at the department level shall be extracted from the links between the process priorities and department responsibilities established through the above-mentioned links.

Unification of goals, processes, functions, and job goals. Establish a unity of corporate goals, processes, functions, and positions based on departmental KPIs, business processes, and responsibilities identified for each position. References:

1. "Management Listing" series ("Performance · Sword", "Culture · Tao" and "Listing · Strategy")

2. Performance Management Website: