Any advice or guidance on Performance Indicators and Key Performance Indicators

I am beginning some work on Uptime Elements Key Performance Indicators with the Reliability Leadership Institute members during our next Face to Face meeting.  

We start with high level organizational objectives and cascade Performance Indicators and Key Performance Indicators for Reliability Engineering for Maintenance, Asset Condition Management, Work Execution Management, Leadership for Reliability and Asset Management - from Strategic metrics to Tactical metrics though line of sight!

Most organizations try to drive performance by focusing on static lag indicators.  Most are not very adept at understanding how to develop and use leading indicators - and those are the secret sauce of business.  If it were all about everyone using the same leading indicators, this topic would have been settled decades ago.  Leading indicators are wagers.  If you could buy a book and win in Vegas - well enough said.

Do you have any advice on a system or process to develop  Performance Indicators and Key Performance Indicators?

Uptime Element Pi

Keep a mild groove on,

Terrence O'Hanlon, CRL

CEO and Publisher

Uptime Magazine


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Original Post

Key Performance Indicators (KPIs) are your dashboard.  These are strategic in nature, but also provide the picture of your strategy.  Performance Indicators on the other hand are more tactical in nature.  There are many more of these, and they are tailored to the level necessary to achieve the KPIs.  In other words, you may have different PIs at the operator level than at the manager level.  All however, should be tied to the KPIs. 

As you said, Leading Indicators are necessary to help predict where you are going...but you also need lagging indicators to show your performance.  A mix of both is necessary for a healthy measurement system.

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