Monitor and measure all the time, yes, it’s always important.
This episode is geared heavily toward the automotive space and third-party vendors.
Performance measurement starts with the target and goal setting! Many people think that they should begin measuring once you have a set target. As a key leader, it is your job to begin by determining realistic targets. Targets based on past performance and adjusting as necessary.
When you are monitoring, your system must be efficient and consistent and it has to be duplicatable. Often auto dealers or other businesses think to themselves, well I want to increase sales this month, so I’ll measure this metric this month. You have to determine what are the real keys… and then measure them every month… until you don’t anymore.
A Key Performance Indicator (KPI) is something that is measurable and allows you to tell when you have achieved a specific goal or set of goals, or not.
When setting the goals and the specific targets, KPI’s for each goal it is important to foresee how the achievement of the target will be monitored and measured.
If a specific target cannot be measured or is very difficult to measure, then you may want to reconsider if it something you should be measuring.
In any business, it is important to take into consideration what the “standards” are. But also to question, how did that become the standard? Can we do better? Is that standard real for our business? Never take a third party or vendor’s metrics as gospel, and not question the source. It is important to ask yourself the question, “How do you know?”
And when doing that, use your metrics primarily, not someone else’s. It’s good to know what other’s are achieving and accomplishing. But make sure that you don’t get caught in the trap of ONLY comparing your business to someone else’s. YOU continue to improve on each days performance every day!
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