How Key Performance Activities Are Different From Key Performance Indicators and Why That’s Important
Author: Bryan Ritchie
A while back I was working with the senior management of a large healthcare company. After developing a strong set of goals that aligned with their strategy, one of the senior directors said, “this is exciting and all, but how do we actually get this done? We’re so busy! How can we get everyone engaged?”
The unfortunate truth is that most organizations that create a strong vision and compelling strategy on paper will fail to implement it. Sometimes it fails because the right people aren’t on the bus. Other times it fails for lack of processes, systems, and methodologies. Still other times it fails for lack of measurement.
But even if an organization has all of the above items, it can still fail because people haven’t created and teams aren’t holding themselves accountable to what we call Key Performance Activities (KPAs): the day-to-day behaviors that link one’s work to the strategic initiatives at the highest level. Most employees’ work is necessary just to keep the business running. But a few activities, if carefully chosen, can move the organization forward. These KPAs are different from Key Performance Indicators (KPIs). Understanding this difference can be the difference between merely stating the vision and goals and actually achieving them.
Most good organizations have articulated a mission and a vision. From this starting point, senior leadership decides on a strategy and articulates some primary goals for the organization to work towards. At this moment, everyone is excited and feels good about what might be accomplished together. The senior team will usually identify the KPIs, or critical measurements, that will indicate success of their efforts to accomplish the primary goals. These KPIs are then typically observed and tracked in a dashboard of some type. At this point there is backslapping and hand shaking for all the good work of getting the company focused–and then everyone goes back to work.
This is usually the point at which the organization encounters the biggest roadblock: In many cases, the mission, vision, strategy, and goals of the organization that were so clear to upper management will not be communicated effectively, if at all, to the front-line team members. But even if they are, rarely will the rest of the organization take the time and effort to identify what their KPAs are that if rhythmically and constantly completed will guarantee the accomplishment of the KPIs. Without this key step, KPIs are only an indication of a hope! Absent the identification of the activities that will lead to specific outcomes, there is nothing that will cause employees to do something different. And without different inputs, the outputs will most likely remain the same.
Here are five steps to creating great KPAs:
- First, you must have a strong foundation of mission, vision, strategy, and primary goals at the organization level. You cannot skip this step. Without this step, there is no foundation to build upon and everyone’s individual goals are more likely to cause confusion than clarity.
- Next, have each team identify the team goals that if accomplished will represent their contribution to completing the organization’s goals.
- After goals are completed you are ready to identify KPAs. Have each team member identify the activities that need to be completed regularly to accomplish the team goal.
- Hold each team member accountable for consistently completing these activities within the appropriate time-frame (daily, weekly, etc).
- Revisit briefly at these accountability intervals whether the KPAs remain relevant or need to be changed, dropped, added, etc.
Let’s end where we began. KPAs are the way to ensure the organization achieves its KPIs. But KPAs are also important in another critical way. Notice that KPAs are identified and implemented by their owners, the individual employees, not their supervisors. KPAs connect people’s day-to-day work to the organization’s highest goals. Nothing creates more engagement than knowing that what you do is important and that someone else cares. Just as the senior leader I referenced above learned, your employees will quickly get engaged in your organization’s highest initiatives if you can allow them to create and be accountable for individual KPAs.
Bryan Ritchie and James Western are co-founders of GrowthSPORT, a successful consulting company whose mission is to improve SCORES (Stimulate Culture, Optimize Results and Engage Staff) for Teams, Divisions, Departments and Organizations through the SPORT model (Strategic Alignment, Personnel Performance, Operational Execution, Results Accountability and Team Strength), which are the Five Core Elements of Success.
GrowthSPORT provides resources, tools and experienced consultants to effectively implement the SPORT performance model from companies ranging from Startups to Fortune 500 companies.
Feel free to reach out to GrowthSPORT at (801) 676-2500 or at www.growth-sport.com.