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KPIs: Not All Metrics are Created Equal

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One of the key concerns during development of key performance indicators (KPIs) is the ability to differentiate the more important strategy-driven metrics from the plain vanilla metrics. This has become an even more urgent concern as the many performance management and BI products are now delivered with thousands of "ready" metrics. Selection of the wrong metrics for KPIs can significantly damage or even submarine a performance management initiative. How does one decide when a metric qualifies as a KPI metric? In my September column, we defined KPIs as measures that reflected the performance of an organization in achieving its goals and objectives. This month, we will use a supply chain management (SCM) example to expand on that definition and provide some characteristics that help distinguish a KPI from all those other metrics.

Supply Chain Management Case Study

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