Top 5 KPIs: Daily, Weekly, and Monthly
Imagine having a set of Top 5 Key Performance Indicators (KPIs)— five daily, five weekly, and five monthly measures—that give you new, invaluable insights into what’s happening in your business because each one measures something in a slightly different way.
At Snapper Lawn Mower, the team funneled five numbers to the top executive at the end of each day, plus five numbers at the end of each week, and five numbers at the end of each month. Even if the numbers didn’t tell a positive story, he knew what he’d be facing the next day. That’s what he preferred because, as you doubtlessly know, it’s the unknown that keeps you up at night.
Snapper’s Top 5 daily KPIs were:
Daily cash amount
Number of retail units sold
Number of units manufactured, by type (Walk-behind units, rear-engine units, tractors, etc.)
The company’s Top 5 weekly KPIs were:
Cash forecast for the next week
Customer service metrics
Sales bookings in dollars
Where grass was growing (weather and seasonal patterns)
Factory production cost performance
Snapper’s Top 5 monthly KPIs were:
Monthly and year-to-date financials in summary form
Overall customer satisfaction
Progress reports on strategic initiatives
Employee satisfaction index
To make tracking most effective you must:
Measure the right things—If you measure the wrong things, the wrong things will get done. It’s best to focus on positive, growth-oriented measures, like gross profit return on-sales or gross profit return-on-investment (inventory plus receivables related to a product line). Instead of tracking waste reduction, make the metric (and associated goal) positive: how much good product is produced using the raw inputs. Or track employee retention instead of employee turnover. Another idea is to measure profitable sales growth, not just increased sales revenues.
Measure only a few key indicators—When you ask people to measure twenty or thirty indicators, it causes confusion. Settle on a few key indicators. For example, if the company is tracking thirty key indicators, break down the list so each executive or manager can track a manageable set of five or six targets. The multibillion-dollar company Danaher measures just six metrics to achieve outstandingly high levels of performance.
Provide lots of feedback—It doesn’t do any good to measure something if people don’t know the progress that’s being made toward the goal and their contribution to it. Be consistent and give regular, in-person feedback to tell employees how they’re doing. Feedback can also be in a written document or update, or it can be displayed on scoreboards throughout the facility.
What are your company’s top 5 daily, weekly, and monthly KPIs? What do you think your competitors’ Top 5 KPIs might be? When focused on these key areas, any business is bound to perform better. Know the most meaningful measures for your business and watch them like a hawk.
Almost everything we experience can be counted or measured, either objectively or subjectively. Although the latter may not always be accurate, a subjective measurement or counting is better than no information at all.