A business is always seeking to define, measure, control, report, and ultimately improve their processes in order to meet – or even better, exceed – their customers’ expectations. But while exceeding customers’ expectations is important, it is also important that the company remains profitable.
One of the most common ways to manage work processes is quality management. Before you
can manage quality, however, you have to define it. This is done using key performance indicators (KPIs). A KPI measures the success of a business’s activities. Success is often defined in two different ways:
1) The repeated achievement of common operations goals such as zero defects, a 100% customer satisfaction rate, etc.
2) Making progress toward a specific goal. This one can be difficult if a business’s goals are not being made in the right way. Well made goals are considered “SMART,” meaning that they are
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Specific. Do you want more visits to your website? More emails requesting whitepapers, ebooks, or other information? More sales calls? The goals can be any number of things, but the more specific the goal is, the easier it is to track its progress.
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Measurable. You must provide quantitative numbers so you know if/when the goals have been met. For example: “For the month of October, we want website traffic to increase from 1,000 visits to 1,500 visits.” Or “We want 100 potential customers to request information about our services and/or products.” These numbers are concrete, easy to measure/track, and indisputable.
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Attainable. You need to know how much website traffic, information requests, sales calls, etc. you are already receiving in order to determine if your new goals are realistic. For example: statistically, only 2 out of every 100 website visitors will become an actual lead. Are you being unrealistic in aiming for 100 new leads per month if you’re only getting 10,000 visitors?
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Relevant. What is your business’s overall goal? Why are you in business in the first place? A goal that you are tracking, like website visits, might be only a small piece of what you do/what you sell/how you run your business, but every goal must tie in to your overall end goal.
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Timely. You must include a time frame or your goal becomes less measurable. Do you want to increase website visits from 1,000 to 1,500 in a month? Within the next quarter? Within the next year? Without a time frame, goals are not measurable.
Another thing to remember about choosing KPIs and setting goals is that while some of them – such as the website visits we’ve talked about – will be overarching the whole business, others will depend on the department that is measuring the performance. The KPIs for the finance department, for example, will be different that the KPIs for the sales department or the manufacturing department.
In order to be successful, your business needs to be efficient. Your work processes must be evaluated constantly and improvements must be made where needed. Choosing key performance indicators and setting good goals will make the evaluation of your work processes far easier.
Contact us today to learn more about managing your work processes and setting smart goals.
