Three Questions to Ask Before Adding a KPI

Three Questions to Ask Before Adding a KPI — title card

It is easy to add a measure to a scorecard. Removing one is harder. Before introducing another KPI, ask three questions.

First: what decision will this measure inform? If no one can describe an action that might follow from a change, the number may belong in a reference report instead of the weekly scorecard.

Second: can we define and collect it consistently? A measure that means something different to each location will produce an argument about data before it produces insight. Write down the period, source, calculation, and owner. If the collection process is unreliable, fix it before attaching a target.

Third: what other measure provides context? Utilization can look strong while overtime rises too quickly. Revenue can grow while the margin on the work narrows. Pair measures that expose tradeoffs, but resist adding so many that the main signal disappears.

Review the scorecard after a few cycles. Notice which measures prompted useful questions and which everyone skipped. A scorecard should evolve with the decisions the team faces. Its purpose is to help people see what needs attention while there is still time to respond.

General information, not accounting, legal or compensation advice. Any examples are fictional.

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