The buzz in IT these days - at least when the topic is business performance management (BPM) - is about key performance indicators (KPIs). How do you pick the right KPI? I'd like to submit the opinion that the only good KPI is a strategic KPI. By strategic, I mean that any KPI you define for your BPM system should be directly traceable to some component of your overall corporate strategy. There should be a direct link from KPIs to goals, from goals to objectives and from objectives to strategies.
Let's take a look at how to develop one. Let's say your company has developed a strategy to improve its overall operational excellence. While this strategy is certainly achievable, it is hardly quantifiable; therefore, it's far from being a KPI. However, one objective you could establish to execute the strategy you've developed could be to improve operational performance in the company's call center. From there, two sample goals to meet that objective could be to improve customer service on calls and to reduce call center costs. These goals are concrete and well on their way to being quantifiable in that you can attach numbers to them, but they're still not metrics that enable you to monitor performance.
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