Key Performance Indicators (KPIs) are built collaboratively within the organisation
The engines that drive container ships from port to port are large and complex machines. Like me, you’ve probably not given them much thought, even though they provide the force that brings most of what we consume to our homes. They stand as tall as a house, but what’s more surprising is that they are digital as well as mechanical systems.
The performance of these engines, down to the level of their parts, is constantly monitored with the data fed back to the engine’s manufacturer in real time as part of an ongoing service plan. From this, repair or replacement of parts can be predicted and scheduled to coincide with port stops. Likewise, the efficiency of the engines — their consumption of fuel relative to the distance travelled — can be optimised.
For the operator of the ship, having engines that perform — available and efficient — is strategically important. It positions them to be profitable and to pursue opportunities. Actions are orchestrated to keep this position, or to restore it with urgency if things go wrong. The complex metrics that allow engineers to keep the engine running efficiently, however, stay with the engineers. Operational measures are distinct from strategic measures.
Those working with digital are focused on delivering the platforms and products that provide beneficial experiences to customers, or employees. They have to deal with multiple systems/platforms and devices, leading to numerous data sources/streams and measures. For many, these pour data into separate buckets which, because they are effectively bottomless, generate little need for action: a storage problem left for IT to solve. Sadly, this is symptomatic: well managed data is at some known point either deleted or archived.
Digital teams — like most if not all other teams in the organisation — lack the capacity, and often the capability, to analyse the data they’re collecting. Instead, it is cherry-picked on demand, with perhaps some rudimentary, though of little value, reporting. The potential for insight is lost in an excess of metrics, most of which are relevant to digital platforms and products, rather than the business. Digital teams can do their work — the work of the engineer — perfectly well with the data they have. And arguably, they should be trusted and left to get on with it. What they can’t and should not be doing is building the KPIs that bind digital to the business.
Developing strategic KPIs is a collaborative exercise between digital and business owners. From our conversations with members and those in the wider J. Boye network, it is clear that many organisations have still to commit to this journey, and start the programme of developing meaningful KPIs from operational measures.