KPI key performance indicators - what is it and how to calculate it. KPI (Key Performance Indicator) system: development and application of business process indicators

The KPI system has come into practice Russian companies a few years ago. Currently, there is no unified methodology for assessing key performance indicators for Russian enterprises, a complex of foreign indicators is used.

Key performance indicators KPI - what is it

KPI (Key Performance Indicator) - key performance indicators - a system of quantitative indicators that reflect the performance of each employee.

The advantage of the KPI system is the active motivation of the staff and comparable indicators. Efficiency - relative indicator, which covers all areas of activity of employees and expresses the results quantitatively. The optimal number of KPIs for one employee is no more than five.

There are several subgroups of KPIs in connection with the following performance results:

• cost item - the amount of resources spent (in value terms);
• performance item - percentage of capacity utilization;
• efficiency article - indicators characterizing the ratio of one indicator to another (for example, the ratio of revenue to costs);
• article results - a quantitative expression of the result of the activity.

Exists several principles for developing a KPI system: the indicator should be quantitatively measurable, related to the results of the company's activities, the measurement of the result should not be costly (in terms of time and use of resources).

Many key performance indicators are interconnected, so it is recommended that several departments and specialists work together to achieve best results. Also managers different levels should coordinate their actions in relation to employees in order to enhance the effectiveness of activities and the achievement of indicators.

Types of indicators

Key performance indicators can be divided into two types - operational and strategic.

Operational indicators reflect the current activities of the enterprise and its divisions, allow you to adapt goals and objectives in accordance with changing conditions. They characterize the quality of the organization of production, the supply of raw materials, manufactured products.

Strategic indicators reflect the result of the company's activities for the period, allow you to adjust plans for the next period. characterize cash flows, on their basis, the performance indicators of the enterprise are calculated (for example, ).

What are KPIs used for?

KPIs are used to quantify goals and objectives. After compiling the indicator report, it is possible to assess how the planned results were achieved, how accurate and correct the planned indicators were.

Subsequently, key performance indicators help to adjust tactical and strategic goals.

The entire KPI system is "tied" to the result, if the indicator does not affect the achievement of the goal in any way, it cannot be attributed in this system.

The technique is based on two theories - the idea of ​​control and revision of goals and management by goals. The essence of the theory is reduced to the possibility of predicting the results of the set goals and planning their achievement through the implementation of KPI.

The system is used to ensure that employees, performing current duties, do not forget about the implementation of their goals. When the KPI is met, the staff will be rewarded, which is a strong motivation for employees.

Key performance indicators are recognized as one of the most effective incentive systems and one of the most advanced motivation systems in the enterprise.

Typically, KPIs are used to evaluate the work of administrative and management personnel (managers, directors, economists, etc.)

In sales

Key performance indicators in sales are calculated based on the following indicators:

• revenue;
• revenue from sales;
• production cost;
• percentage of defective products;
• the amount of current assets;
• inventory value.

In production

Key performance indicators in production are calculated based on the following indicators:

• average daily consumption of raw materials;
• the volume of work in progress and stocks;
• labor productivity of workers;
• other production expenses;
• repair of equipment;
• storage of finished products.

Examples of KPIs for representatives of various specialties

Job title	Index	Formula
Head of marketing department	Sales plan (percentage of plan completion)	(Q f / Q pl) * 100%, where Q f - actual sales volume, Q pl - planned sales volume
Marketer	Market share by brands (percentage of total brands on the market)	Data from external marketing agencies
Chief Accountant	Timely filing of tax returns	Tax service data
Accountant	Timely execution of payment transactions (percentage of the total number of completed payment transactions)	(Op cf /Op total) * 100%, where Op cf - the number of payment transactions performed on time, Op total - the total number of payment transactions
Head of Legal Department	Number of cases won (percentage of total cases)	(Q in / Q total) * 100%, where Q in - the number of cases won, Q total - the total number of cases
Lawyer	The amount of money collected and saved for the enterprise	Legal department report data

A video explaining why you should implement a KPI system when building business processes:

Discussion (10 )

KPI is one of the tools to save on employee salaries. The better they work, the more every month they raise the plan for " independent reasons". As a result, the salary is always from 65 to 80 percent of the declared one. It depends on what schedule you were put on and how other employees snapped up productive resources. As a result, grabbing, division, conflicts.

If this is stimulation and increased motivation, then this is understandable, but if this is simply a decrease in pay for more intensive work, then this is profanity. My employer takes indicators from the ceiling and ties me to these “wishlists” and, as a result, demotivates me if I fail to do so. As a result, I am looking for a job. Since I understand what real sales and how much I bring profit to the company. If the indicators are taken simply in progression without taking into account the market, the economic situation and other things, then this is just a road to nowhere. All Western know-how, as a rule, have analogues even in practice or developed in the USSR. All these frugality and linaxes come from there. The fact that we are adopting some advanced experience is a complete illusion. It's just that the level of real intellectual activity in the country is extremely low. Above what should be below. Time will show that this is a dead end. We are not Chinese.

1. The implementation of kpi in an enterprise is always a difficult process, especially when everyone resists. An external consultant or a company that deals with such issues can help.

   The introduction of KPI is motivated by an increase in the efficiency of the organization (enterprise) as a whole, taking into account the return of each employee. And if all the conditions and key indicators for each position are discussed in the regulation on remuneration and bonuses, doesn’t this contribute to the effectiveness of the results of the work of each and in general? Is KPI implementation not an invention of the wheel?

   When using KPIs, in some cases, you may need to resort to special reporting tools. In addition, someone from the staff will need to be instructed to collect the necessary data and analyze them, and you, in turn, will need to conduct a check. If the changes in the company's work will be private, you will need to monitor frequent KPI changes and investigate the reasons for such changes. Therefore, first evaluate your resources and opportunities, value your time. You must clearly understand how you will benefit from the effort expended when implementing KPIs.

   Key indicators are one of essential tools improve business efficiency. It's like in sports - the measurement of indicators in itself contributes to an increase in results. Of course, implementing KPIs is not without its challenges—often employees sabotage methods that make them work harder. However, the result of a more profitable and manageable business more than justifies the effort.

You will learn:

• What are the pros and cons of the KPI system.
• Which employees should not implement KPIs.
• What KPIs to set for the manager.
• What to do if employees sabotage KPI implementation.
• How to review the KPI system.

What is a KPI system

KPI is a special system of indicators, using which employers can evaluate the performance of subordinates. At the same time, KPI - key indicators of each employee - are tied to general business indicators (level of profitability, profitability, capitalization).

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There are different KPI goals, but the main one is to create a situation in the company in which employees from different departments could act together, without contradicting their business actions to each other. The activities of one specialist should not interfere with the work of another or slow it down. All employees must strive for a common goal and work effectively, receiving bonuses for this.

It is believed that KPIs are directly related to BSC (Balanced Scorecard - balanced system indicators), but this is not the case. The creators of BSC did not use the term KPI. They used the concept of "measure", "meter", or measure.

KPI and BSC are indirectly related. BSC is endowed with the perspective of business processes, where the associated goals are present. To measure how these goals are achieved, specialists use business process KPI indicators.

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So what is KPI in simple words? These are certain indicators, thanks to which it becomes much easier to understand what actions should be taken to increase efficiency. At the same time, efficiency is not only the number of manipulations carried out over a certain period of time, but also the benefit that the company received from the work of a single specialist.

Company KPIs are shared. However, in the divisions they are divided into small ones, called personal ones. There cannot be many of them. 3-5 clearly defined and understandable indicators are enough. The main requirement is the ability to simply and quickly measure them.

Here are some examples of KPIs . Possible KPIs for a sales manager are as follows: “Sales volume not less than…”, “Number of new clients not less than…”, “Average contract amount per client is approximately…”, “English proficiency not lower…”.

Another example of KPIs. You are the owner of a large point of sale household appliances. 12 managers work for you. How effectively each of them works during the month is evaluated based on the following indicators:

• how many people the manager talked to bought the equipment (percentage);
• the amount of the average check;
• to what extent the sales plan has been fulfilled (for example, the amount of the minimum bar is 350 thousand rubles a month; the level of overfulfillment of the plan as a percentage will affect the manager’s salary).

For example, you need to sell mixers of a certain brand and manufacturer. In this case, it would be reasonable to set a plan for each manager with a minimum number of mixers equal to 5. If the manager sells equipment more than the planned number, he receives 3% of the cost from each "extra" mixer. For specialists, this is a great motivation, KPI of this type allows you to successfully sell products. Experience shows that the optimal number of KPI criteria for one specialist is from 5 to 8.

3 interesting facts about KPI

• The Key Performance Indicators system has been used in the West for over 40 years. In the CIS countries and Russia, it has been used for about 15 years.
• In a number of states (Korea, Singapore, Hong Kong, Japan, Malaysia, Germany and the USA), the Key Performance Indicators system is a national idea. KPI is not just a concept there, but the basis of the work of all companies.
• Russian President Vladimir Putin proposed creating a Key Performance Indicators system to evaluate how officials work.

How to avoid mistakes when implementing KPIs

The editors of the magazine "General Director" considered 6 popular mistakes in the KPI system and gave advice on how to avoid them.

Where does KPI development begin?

KPIs should be created from the top down, starting with the company's large-scale goals to the tasks facing the individual employee. To fully solve problems, it is necessary that all personnel be involved in the preparation of the KPI system. We are talking about employees working in the planning, economic, financial, organization management specialists labor activity, a team of personnel departments, sales, technology department.

To get started, the organization needs to figure out which KPIs to prioritize. To do this, the enterprise specifies and checks the goals of a strategic and operational nature. The formulation of the goal should ideally be such that it does not have a clear designation of the financial component as the main indicator. Better if financial indicator will follow from the main task. With this approach, the company will be able to feel confident in the crisis period.

Requires connection of the goal with the market environment, changes in the market. For example, a company may set itself the goal of becoming one of the TOP-3 in the market for its products or take a leadership position in a certain territory. After being formulated the main objective, subgoals are highlighted.

After setting goals, you should analyze how effectively the company is now working and how it solves current problems. At the same time, it is necessary to determine how it will be calculated wage employees.

When creating KPIs in an enterprise, it is important to budget for personnel costs. In this case, it is divided by types of payments. In addition, it is required to take into account the indexation of wages and career specialists.

At the final stage of development, provisions are created, KPI maps are prepared, the methodology for calculating each key indicator is prescribed, and the system is coordinated with the management of all independent units in the company.

The regulation on KPI should include information about the goals and objectives pursued by the system:

• Improving results and increasing the efficiency of specialists. Development and implementation of employee motivation.
• Increasing the profitability of the company. Development of goals and performance indicators for each position in the departments and divisions of the company.
• Creation information base which will allow you to make the right management decisions. Ensuring prompt collection of information and control over the functioning of the system.

Key performance indicators and their types

Key KPIs are:

• lagging, reflecting the results of the work at the end of the term. We are talking about financial KPIs that testify to the potential of the company. However, such coefficients cannot show how efficiently the departments and the organization as a whole work;
• operational (leading), which allow you to manage the state of affairs during the reporting period in order to achieve the goals at its end. Operational performance indicators help to understand how things are now at the enterprise, and, at the same time, demonstrate financial results further. On the basis of operational KPIs, one can also judge how well the processes are running, whether the products are good, how satisfied customers (consumers) are with them.

The main conditions are that indicators should contribute to the implementation of intermediate and final goals, and all indicators can be quickly and easily calculated. The coefficients are different - qualitative (in the form of a rating or points) and quantitative (in the form of time, money, production volume, number of people, etc.).

Examples of KPIs

KPI for an employee technical support. A specialist of this profile should advise those who are real buyers and help potential customers. The set of KPIs in this case is small. The work of an employee is evaluated on the basis of how well he conducts consultations, in what quantity, whether customers are satisfied with the service.

Key performance indicators for a sales manager. The number of new buyers must not be below a certain mark, the volume of sales must not be less than the established limit, the size of the average contract per client is within the indicated boundaries, the ownership English language on one level or another.

The KPI system consists of a number of indicators, but the universal ones are:

• Process, indicating what result the process has brought, how requests from consumers are processed, how new products are created and brought to the market environment.
• Client: how satisfied are the customers, how is the interaction with the sales markets, how many buyers were attracted.
• Financial allow you to judge the external economic situation of the enterprise. Here we are talking about the level of profitability, turnover, market value products, financial flow.
• Development criteria show how dynamically the company is developing. This is the degree of productivity of specialists, the level of staff turnover, the cost per employee, employee motivation.
• Indicators external environment: how the price fluctuates, what is the level of competition, what price policy On the market. These indicators should certainly be taken into account when creating KPIs.

How to calculate KPI

Stage 1. Choice of three key indicators efficient operation specialist:

• the number of users who were attracted to the site;
• the number of repeat orders from existing customers;
• the number of recommendations and positive feedback that appeared after purchasing a product or ordering a service on the website and social networks of a trade organization.

Stage 2. Determining the weight of each indicator. The weight in the total is equal to 1. At the same time, the largest share belongs to the priority indicator. As a result:

• the number of new customers is given 0.5;
• the number of repeat orders - 0.25;
• reviews - 0.25.

Stage 3. Analysis of statistical data for the past six months for each KPI and development of a plan:

Stage 4. KPI calculation. An example is presented in this table:

KPI calculation formula: KPI Index = KPI Weight * Fact / Goal

In this case, the goal is the planned indicator of the marketer. The fact is the real result.

It becomes clear that the specialist has not achieved his goals to the end. However, based on the overall rate of 113.7%, it is safe to say that the real result is quite good.

Stage 5. Payroll preparation.

In total, the marketer is owed $800, of which $560 is a fixed portion and $240 is a variable portion. The full salary of a specialist is paid for an index equal to 1 (or 100%). Thus, the indicator of 113.7% indicates that the plan was overfulfilled, which means that the marketer is given a salary with an additional bonus.

Result:

560$ + 240$ + 32,88$ = 832,88$.

If the KPI index is less than 99%, the amount of bonuses is reduced.

Such a table allows you to see the problems in the work of a marketer, the difficulties with which he cannot cope. Probably not enough good results activities can be caused by the wrong strategy to increase the level of customer loyalty. However, it is possible that initially the plan itself was drawn up illiterately. In any case, the situation must be controlled. If things don't improve in the future, reconsider the requirements for performance indicators.

If you stick to such a policy, you will learn what KPIs are in the process of production, sales, etc. You will better understand how the calculation of indicators and the process of their implementation should be.

The calculation can be modified taking into account the planned results, supplemented with new values: an indicator of the number of solved and unsolved tasks, a system of penalties for poor performance on the main points in the plan.

So, for the implementation of the plan for less than 70%, the employee may not receive a bonus at all.

There is also the following scheme for calculating the bonus part of the salary for a specialist who has fulfilled the sales plan:

Implementation of KPI in the company

Both employees and third-party consultants can be responsible for the process of implementing the KPI system created in the company. At the same time, one should take into account the specifics of the enterprise, how business processes flow in it, what goals and objectives the company sets for itself. It is necessary that the rank-and-file staff be aware of how the payroll system will change. Communicate to employees that the main indicator will be the level of their effectiveness. When introducing a KPI system, specialists should be trained. Personnel must understand that changes are beneficial mainly to them. Implementation of the system involves the development of special documentation: employment contracts, staffing, collective agreement and other papers related to payment for the activities of employees.

Before introducing a KPI system, test it with pilot project. Take 1-2 departments and work out new processes and wage formation in them in a pilot mode. The ratio of fixed and bonus components of remuneration can be adjusted in real time, taking into account target indicators for specific groups of personnel.

When new order has been tested and fully adjusted in the company, you can introduce it to other departments. Remember that it is better not to implement a KPI system without testing. As part of the pilot project, it will be possible to clearly understand what difficulties the system causes for personnel, learn about possible shortcomings and quickly eliminate them. All employees of the enterprise must work towards a common goal. Otherwise, employees will only experience discomfort, and all actions and aspirations will be in vain.

In the process of introducing KPIs in the company, make sure that the indicators can be adjusted if necessary. Thanks to the constant monitoring of indicators, it will be possible to adapt in time to changes in market environment and edit the working strategy. In addition, every year it is necessary to improve the model for the formation of premiums, that is, to optimize it. As part of the optimization, the evaluated indicators are changed to others that are more relevant for certain employees and departments.

What KPIs to set for the manager

KPI personnel and management should be related to the main objectives of the enterprise. You need to know exactly what you want to achieve after a certain period of time. You can strive to get ahead of the competition and become a leader in your industry. Another option - the head of the company wants to sell the business for favorable price. KPI for the first case is an increase in the customer base and sales volumes, for the second - an increase in the capital of the company and the achievement of the maximum sale value.

The main goal in without fail it is necessary to write down and formalize, and then break it into subgoals. When specialists successfully fulfill subgoals, they approach the solution of the main task of the enterprise.

If it's about large organization or a holding company, a director's KPI is required for each division and branch. If the owner of a large enterprise plans to compare the performance indicators of General Directors who are geographically distant from each other, it is necessary to develop unified system estimates. At the same time, it must be remembered that those KPIs that are easy to achieve in large regions are not always easy to achieve in small ones. In this regard, the system can be formulated in approximately the same way, but the numbers of indicators should be different for managers in different regions.

When preparing KPIs, try to set indicators in the optimal amount so that the employee can easily monitor work performance. It is better if there are five KPIs. When installing more indicators, the director may not pay attention to the main ones and focus on the minor ones.

When creating a KPI system for management, a combination of general and personal indicators is optimal. General indicators are called the results of the activities of the department subordinate to the specialist. On the basis of general indicators, it becomes clear how the team works, how much the manager is interested in solving the tasks. Personal indicators are called individually achieved goals and results of activities.

If the KPI system is created well, the ratios show how each of the managers works, and this information is useful for the company.

KPI-based personnel are gaining more and more popularity in Russia. The main advantages of such mechanisms are in the rational reflection of the activities of companies.

KPI: what is it

KPI (KPIs) is the English abbreviation for “key performance indicators”, in Russian it is referred to as KPIs - key performance indicators (sometimes parameters). But in the original foreign sounding it is used as a norm. KPI is a system that allows you to evaluate the performance of the company's employees in order to achieve goals (strategic and tactical).

"Key indicators" allow the company to analyze the quality of its structure, the potential in solving problems. On the basis of KPI, a system of the most important factor is also formed: if there are no signs of targeting, then there is nothing to apply to “key indicators”. and KPI, thus, are two interrelated phenomena. The first involves, first of all, forecasting the results of work, as well as planning how these results will be achieved.

Who came up with KPI?

History does not give an unequivocal answer to this question, however, one can trace how the world management went to understand KPIs, what it is and why it is useful. In the late 19th and early 20th century, the sociologist Max Weber determined that there were two ways to evaluate the work of employees: the so-called "sultanic" and meritocratic. According to the first, the boss (“sultan”) at his own discretion assessed how well a person copes with his duties. The rational principle here plays a secondary role, the main thing is a purely emotional perception of the work of a subordinate.

The meritocratic method is when the results of labor are evaluated according to real achievements, with the involvement of objective measurement mechanisms. This approach was adapted by management theorists in Western countries and gradually crystallized into what we know as the KPI system. An important role in systematizing the rational evaluation of personnel performance was played by the works of Peter Drucker, who is considered to have turned management into a scientific discipline. The concepts of the scientist directly state that there are goals, but there is an assessment of the degree of their achievement through key performance indicators.

Benefits of KPIs

home positive side KPI systems - the presence of a transparent mechanism for all employees of the company to evaluate the work and work of the enterprise as a whole. This allows the authorities to evaluate the performance of all subordinate structures in real time, predict how tasks will be solved and goals achieved. The next plus of KPI is that the management has a tool for adjusting the work of subordinates if the current results lag behind the planned ones.

If, for example, performance measurement in the first half of the year reveals that performance is not high enough, then workshops are held to identify the reasons and encourage employees to perform better after the next six months. Another positive side of KPI is the feedback between the specialist and the manager. The first will receive not just instructions and sometimes seemingly biased nit-picking, but well-founded comments, the second will improve performance by specifying errors and shortcomings in the work performed by the subordinate.

Cons of KPIs

The results of assessments within the framework of KPIs (performance indicators as such) can be interpreted not quite correctly, and this is the main drawback of this system. As a rule, the probability of occurrence of such a problem is the lower, the more attention is paid at the stage of formation of criteria for how to evaluate performance parameters. Another disadvantage of KPI is that companies will have to spend a lot of resources (usually calculated in time, labor and finance) to implement this system. We are talking, of course, about working on the key parameters of the effectiveness of the proper level of elaboration. There is a possibility that it will be necessary to carry out large-scale retraining of employees: specialists - with a view to changing tasks, and hence working conditions, while management will have to master new methods for assessing the work of subordinates. The firm may not be ready to give the team extra time to learn new things.

Subtleties of KPI implementation

The main task when implementing a KPI system (“from scratch”) is to prevent a negative attitude towards it from employees. Therefore, the management of the company needs to clearly convey the meaning and practical benefits of innovations to each of the subordinates, whose work is subject to subsequent evaluation for effectiveness. The best method here, according to some HR experts, is an individual presentation, an explanation to specialists in specific positions: KPIs - what is it and why should this system be implemented in a company.

It will be a mistake to unconditionally impose efficiency parameters by order, but the necessary step is an appeal from the top officials of the company. If, for example, a line manager informs subordinates in his department about the imminent implementation of KPI, then this information should also be confirmed and CEO. The specialist must understand that the system of key performance parameters is not an invention of the boss, but an element of the strategic policy of the entire company.

Optimal timing of KPI implementation

There is an opinion among experts that KPI indicators, if we are talking about a system, should be implemented simultaneously at all levels of company management - from ordinary specialists to top managers. According to this point of view, the timing of the implementation of key performance indicators cannot be extended in time: the system starts working immediately. The only question is how to optimally choose the moment of its launch. There is a point of view that it is enough to notify employees about the start of KPI about three months in advance. This is enough for the company's staff to study the specifics of the future assessment of the effectiveness of their work.

There is also the thesis that for some time KPI can work in parallel with the previous payment system. Depending on the degree of liberalism of the authorities, the employee will be able to choose according to which scheme he will be paid. It is possible to fully motivate a person to work according to the new KPI through bonuses and bonuses, the conditions for obtaining which will be clearly spelled out in the key parameters.

Stages of creating a KPI system

Actually, as such, the introduction of KPI mechanisms is preceded by several stages of preparatory work. Firstly, this is the period associated with the formulation of strategic goals that are set for the company. As part of the same stage of work, the general concept is divided into tactical areas, the effectiveness of which is to be measured. Secondly, it is the development of key performance indicators, the definition of their essence. Thirdly, this is work on the distribution of official powers related to the implementation of the system, so that each person in charge asks a question like “KPIs - what are they?”

Thus, all indicators will be assigned to specific individuals (divisions) in the company. Fourth, current business processes may need to be adjusted (if the updated strategy requires it). Fifth, is the development new system creation of payroll formulas according to fresh criteria. After completing all of the above procedures, you can start the KPI system.

KPI Requirements

As mentioned above, KPIs are key performance indicators that are inextricably linked to the company's goals. The quality of targeting development is the main requirement for the KPI system. Goals can be formed according to different principles, but one of the most popular in the HR environment is the SMART concept. Means "specific" (specific), "measurable" (measurable), "achievable" (achievable), "related to the result" (relevant), "time-bound" (time-bound), and, as a result, giving worked out and quality KPIs.

Examples of goals that meet these criteria: "open so much (measurable) outlets(specific) in a city (relevant) in the first quarter (time-bound)”, or “sell so many air tickets to such and such a country in three weeks”. Each goal should be divided into tasks, which, in turn, are reduced to the level of personal KPIs (for employees or departments). The optimal number, according to some experts, is 6-8.

KPI automation

One of the factors for the successful implementation of KPIs is the technological infrastructure. Since key performance indicators are a set of rational indicators, a computer will do a very good job with them. There are many software solutions for managing KPIs. The possibilities available in such distributions are quite extensive. Firstly, it is a convenient presentation of information (in the form of graphs, analytics, documentation) about the processes associated with KPIs. What does it give? Mainly, the unity of data perception, reducing the likelihood of misinterpretation of numbers. Second, the collection and calculation of performance indicators. Thirdly, this is a multidimensional (with very large volumes of numbers) analysis, which will be difficult for a person without a program to perform. Fourth (if there is a network infrastructure), this is the exchange of information between individual employees and the establishment of channels feedback"boss-subordinate".

KPI is a performance indicator that allows you to objectively evaluate the effectiveness of the actions performed. This system is used to evaluate various indicators (the activities of the entire company, individual structures, specific specialists). It performs not only the functions of control, but also stimulates labor activity. Often, a pay system is built on the basis of KPI. This is a method of forming a variable part of the salary.

KPI Key Performance Indicators: Examples in Excel

The stimulating factor in the KPI motivation system is cash reward. It can be received by the employee who completed the task assigned to him. The amount of bonus / bonus depends on the result of a particular employee in reporting period. The amount of remuneration may be fixed or expressed as a percentage of salary.

Each enterprise determines key performance indicators and the weight of each individually. The data depends on the tasks of the company. For example:

1. The goal is to provide a product sales plan in the amount of 500,000 rubles per month. The key indicator is the sales plan. Measurement system: actual sales amount / planned sales amount.
2. The goal is to increase the amount of shipment in the period by 20%. The key indicator is the average shipment amount. Measuring system: actual average shipment / planned average shipment.
3. The goal is to increase the number of customers by 15% in a certain region. The key indicator is the number of customers in the enterprise database. Measurement system: actual number of clients / planned number of clients.

The company also determines the spread of the coefficient (weights) independently. For example:

1. Implementation of the plan less than 80% is unacceptable.
2. Implementation of the plan 100% - coefficient 0.45.
3. Implementation of the plan 100-115% - a coefficient of 0.005 for every 5%.
4. No errors - coefficient 0.15.
5. There were no remarks in the reporting period - coefficient 0.15.

It's only possible variant determination of motivational coefficients.

The key point in measuring KPI is the ratio of the actual indicator to the planned one. Almost always, an employee's salary consists of a salary (fixed part) and a bonus (variable / variable part). The motivational factor influences the formation of the variable.

Let's assume that the ratio of the fixed and variable parts in the salary is 50 × 50. Key performance indicators and the weight of each of them:

We accept the following values ​​of the coefficients (the same for indicator 1 and indicator 2):

KPI table in Excel:

Explanations:

This is a sample KPI table in Excel. Each enterprise makes its own (taking into account the peculiarities of the work and the bonus system).



KPI Matrix and Example in Excel

To evaluate employees on key performance indicators, a matrix, or agreement on goals, is drawn up. The general form looks like this:

1. Key indicators are the criteria by which the work of the personnel is evaluated. They are different for each position.
2. Weights are numbers in the range from 0 to 1, total amount which equals 1. Reflect the priorities of each key indicator, taking into account the objectives of the company.
3. Base - the allowed minimum value of the indicator. Below the baseline - no result.
4. The norm is the planned level. What an employee must do. Below - the employee did not cope with his duties.
5. A goal is a value to aim for. Above the norm, which allows to improve the results.
6. Fact - the actual results of the work.
7. The KPI index shows the level of the result in relation to the norm.

Formula for calculating kpi:

KPI index = ((Fact - Base) / (Norm - Base)) * 100%.

An example of filling out a matrix for an office manager:

The performance ratio is the sum of the products of indices and weights. Employee performance evaluation is visually shown using conditional formatting.

Kipiai, or key performance indicators, is a unique system that has recently come into Russian business. To date, there is no more reliable method by which to evaluate the efficiency of the enterprise, so the use of this system is practiced not only in Russia, but throughout the world.

The concept of KPI

To begin with, let's fully reveal the question of what it is - KPI, or key performance indicators.

Ki Pi Eye is a unique system with which you can calculate the performance of each individual employee of the organization. Thanks to such a system, one can not only understand how effective the activities of employees are, but also motivate them to improve their working skills. The most optimal performance indicators for each individual employee should not exceed the figure 5.

To understand how to operate this system correctly, it is necessary to more carefully and deeply study the types of performance indicators, as well as consider examples of KPIs.

Varieties and groups of KPI

Kipiai indicators are usually divided into several subgroups, based on the results obtained in the calculation of the results of a certain area of ​​activity.

1. Financial expenses.
2. The performance of the company, implying the calculation of kpi as a percentage. This percentage shows how high the capacity utilization of an enterprise is.
3. The productivity of the firm. This subgroup of KPI performance indicators is based on a comparison of certain data (for example, cost items and revenue for a certain period of time).
4. Final calculations, which are based on the quantitative expression of the results related to the activities of the company's employees.

A key performance indicator is built on several principles. If you do not take them into account, then the data obtained will be unreliable. These are the principles:

1. All indicators must be measured in quantitative terms.
2. The data obtained should be directly related to the activities of the company.
3. Results should not be costly, both in terms of time and resources.

Earlier, we considered the question of what is KPI, dividing it into 3 small subgroups. However, the gradation does not end there, because this system also has its own varieties. There are two of them in total. These are operational and strategic KPIs. Let's first understand what kind of operational KPI system it is.

Operational KPIs are indicators that can be used to evaluate the effectiveness of a company's activities on this moment. Simply put, the data obtained when calculating kpi reflects how well the company's employees work in the current period of time.

Besides, operational systems kipiai help to compare the tasks performed by employees with the conditions that were created for this. Based on the results obtained, the management of the enterprise can evaluate the quality of the manufactured product, the conditions for its delivery and further distribution.

What is a strategic KPI? Such indicators reflect the performance of the company for a certain period of time. With their help, you can find shortcomings in the work of personnel and adjust its activities for the next period of time (for example, for the next month, quarter, six months, etc.).

In addition to the quality of work of employees, financial data can also be processed. Based on the results of the KPI calculation, cash flows are characterized, which help to understand how profitable the organization itself is, and how much the products produced by it are in demand.

Scopes of KPI and its calculation

Since we figured out what kpi is, or, in simple terms, key performance indicators, we need to move on to the next, no less important, question: where and why are they used? And also consider the formula by which they are calculated.

A performance indicator is a numerical measurement of the set (and achieved) goals and objectives that play an important role in the successful promotion of a business. Thanks to the prepared report, where all the necessary indicators are taken as a basis (they were discussed above), the management of the organization has the opportunity to fully assess how the developed plan was carried out, as well as what was achieved over a certain period.

KPI is used in various fields business. Each of them has its own list of indicators that are being processed, and on the basis of which an indicator is calculated that reflects the efficiency of the enterprise.

Sales area

To multiply your fortune, you need to understand what KPIs are in sales and what an important role they play. These indicators can be calculated based on:

• received for a certain period of financial profit;
• proceeds from sales carried out by the firm;
• the cost of manufactured goods;
• the percentage of low-quality goods;
• amounts of current assets;
• the total value of all the company's inventory.

KPI indicators in retail are based on 5 main principles:

• percentage of sales for 1 hour or day of the outlet;
• the average amount of money paid by the buyer for the goods (this amount is calculated at the expense of punched checks);
• the number of products sold for 1 time;
• the ratio of employees' salaries to the proceeds from the sale of goods;
• sales conversions.

Thus, having received all the necessary calculations, you can quickly adjust the work of the staff, significantly increasing the number of transactions, which, in turn, helps to increase the store's income.

Manufacturing industry

What is a key indicator in production, and on what basis is it calculated? First of all, when calculating the efficiency coefficient, they take as a basis:

• indicators of the average daily consumption of raw materials from which products are made;
• volumes of raw materials used and remaining in stock;
• volumes of work in progress;
• work efficiency of employees;
• various production costs;
• equipment repair cost;
• conditions, terms and cost of storage of finished products.

To get the right data, you need to know how to calculate KPIs. There is a special formula for this:

(qf/ qpl)×100%

Now let's decipher the indicators:

• qf - the actual volume of all sales carried out by the company;
• qpl - sales volume, which is only planned to be carried out.

The data obtained through this form is the so-called performance criterion.

Examples of KPIs

To fully understand what kipiai is, let's look at some examples of key performance indicators. For a better understanding of the essence, each of the professions that are taken into account in the calculation will be considered separately. The table below shows not only the type of activity, but also the indicator on the basis of which the efficiency criterion is calculated.

Number	Job title	Indicator for calculation	Formula for calculation
1	Head of Marketing Department	The total percentage of the previously developed plan.	The general calculation formula described above.
2	Marketer	Overall percentage of all brands on the market	Calculated based on data from all third-party marketing firms.
3	chief accountant	Timeliness of submission to the tax service of the declaration on the income of the enterprise.	Data obtained from the tax authority.
4	Accountant	Total percentage of completed financial transactions	This profession has its own formula for calculating kipiai: (qpsr/qtot) × 100%, where the first indicator in brackets means the number of financial transactions that were completed on time, and the second - the overall results regarding all payment transactions.
5	Head of the legal department	The total number of lawsuits won is taken as a basis.	The ratio of the number of cases won to the total number of trials. The result is multiplied by 100%.
6	Lawyer	The amount of money that was collected from other enterprises in favor of the organization where the person works. The amount of money that was saved by the company is also taken into account.	All data from reports prepared by the legal department are taken into account.

If we again take the example of a sales manager’s kpi as a basis, then with the help of the data obtained after the calculation, the head of the management department will be able to identify not only positive, but also negative points in the activities of his subordinates. So, he will know exactly how many calls and meetings the sales manager made, whether they were effective, how many people became regular customers, etc.

If the data obtained do not correspond to the developed plan, then this means that the person involved in this type of activity lacks either knowledge and skills, or perseverance and desire to work.

All the above examples of KPIs, or key performance indicators, fully reflect the essence of this concept. Of course, it is difficult to immediately understand all these subtleties (especially for a novice businessman). However, it is better to spend a little time on an in-depth study of this important topic than to incur financial losses that can seriously harm the development and successful promotion of a business.