Bernard Marr - Key Performance Indicators For Dummies

Bernard Marr is the founder and CEO of the Advanced Performance Institute, an organisation that specialises in KPIs, metrics and analytics as well as performance and strategy management.

Through his work at the Advanced Performance Institute, Bernard helps clients with their KPI, metrics and data needs. As a best-selling business author, keynote speaker, consultant and trainer, he is widely recognized as one of the worlds leading experts on the topic.

Bernard is acknowledged by the CEO Journal as one of todays leading business brains and LinkedIn nominated him as one of the worlds top 100 business influencers.

He has written a number of seminal books and over 300 high profile reports and articles. This includes the best-sellers 25 Need-to-Know Key Performance Indicators, The Intelligent Company, Doing More with Less Measuring, Analyzing and Improving Performance in the Not-for-Profit and Government Sectors, Managing and Delivering Performance, and Strategic Performance Management.

Bernard has worked with and advised many of the worlds best-known organizations including Accenture, Astra Zeneca, Bank of England, Barclays, BP, DHL, Fujitsu, Gartner, HSBC, Mars, Ministry of Defence, Microsoft, Oracle, The Home Office, NHS, Orange, Tetley, T-Mobile, Toyota, Royal Air Force, SAP, Shell, the United Nations, among many others.

If you would like to talk to Bernard about any KPI project you require help with or if you are thinking about running a KPI event or training course in your organization, then contact him at www.ap-institute.com or via email at:

You can also follow @bernardmarr on Twitter, where he regularly shares his ideas or connect with him on LinkedIn, where he writes a regular blog.

This book is dedicated to the people who give me meaning and pleasure beyond measure: My wife Claire and our three children Sophia, James and Oliver.

I am so grateful to everyone who has helped me get to where I am today. All the great people in the companies I have worked with who put their trust in me to help them and in return give me so much new knowledge and experience. I must also thank everyone who has shared their thinking with me, either in person, in blog posts, books or any other formats. Thank you for generously sharing all the material I absorb every day! I am also lucky enough to personally know many of the key thinkers and thought leaders in the field and I hope you all know how much I value your inputs and exchanges. At this point I usually start a long list of key people but I always miss some off, so this time I want to resist that and hope your egos will forgive me. You are all amazing!

Finally, I want to thank the team at Wiley for all your support. Taking any book through production is always a challenging process and I really appreciate your input and help. A special thank you to Karen McCreadie for the amazing editorial support!

Publishers Acknowledgments

Acquisitions Editor: Annie Knight/Claire Ruston

Project Editor: Simon Bell

Copy Editor: Kate OLeary

Proofreader: Martin Key

Project Coordinator: Sheree Montgomery

Cover Image: iStock.com/Kalawin

Chapter 1

In This Chapter

Understanding KPI basics

Identifying the most common errors

Identifying the key business areas to measure

So what the heck are Key Performance Indicators (KPIs) anyway?

KPIs help organisations understand how well they are performing in relation to their strategic goals and objectives. In the broadest sense, a KPI provides the most important performance information that enables organisations or their stakeholders to understand whether the organisation is on track toward its stated objectives or not. In addition KPIs serve to reduce the complex nature of organisational performance to a small, manageable number of key indicators that provide evidence that can in turn assist decision making and ultimately improve performance.

If you think about it, this is the same logical approach we use in our daily lives. Say you are not feeling very well and decide to visit your doctor. She may ask you what is wrong but shes immediately searching for evidence to qualify your subjective opinion. She may, for example, take your blood pressure and measure your cholesterol levels, heart rate and body mass index as key indicators of your health. With KPIs we are trying to do the same in our organisations. And without them we are flying blind, relying on the often subjective assessment and opinion of key personnel.