Why organizations should regularly assess the KPIs they track
(Editor's note: This is part one of a two-part series. Part two can be viewed here).
Key performance indicators are an essential part of data governance because they help determine the worthiness of the captured information. Data that lacks sufficient, measurable value could be misleading, and even damage a company’s reputation.
However, KPIs alone are not enough. Instead, it’s necessary to regularly re-evaluate all applicable KPIs to ensure they’re still providing information that’s relevant to the business at large and in line with its data governance strategies.
KPIs Can Show Whether Strategies Are Working
There are several kinds of KPIs related to data governance, such as those measuring risk events that could occur if the data quality is poor. Each department that deals with data governance must follow sets of standards. Some KPIs could specifically reveal if such standards are working as they should to maintain or improve data quality.
Other KPIs, such as data completeness and consistency, could measure changes in the data over time. If an organization aims to have more complete and consistent data sources and fully defined strategies to achieve those goals, KPIs indicate effectiveness — or lack thereof.
People should re-evaluate any KPIs associated with data improvement to determine if data governance strategies for growth are functioning appropriately, or if it’s necessary to do things differently for better results.
Changing Business Strategies May Require KPI Adjustments
Data governance normally aligns with a company’s overall strategy. However, it’s natural and typical for a business’ plan to evolve.
If a business goes in another direction, that change may require data governance experts to use different KPIs than the ones they monitored previously. A worthy KPI assesses whether something performs to expectations. However, an establishment’s definition of what constitutes performance may not stay consistent after an underlying strategy shift.
Data Governance KPIs May Shift as the Employee Makeup Does
The department responsible for data governance at an organization may set team-specific milestones, or have goals for individual team members that directly relate to the overall organization.
As such, it may be necessary to reassess data government KPIs when new team members get hired or leave the company, especially if new hires have specific roles that could relate to KPI measurements.
Some examples of potential KPIs related to people include the number of individuals who receive a certain data management certification. Or, if an organization begins a new process, the adoption rate among employees could be another KPI to track.
Some KPIs Are Industry-Specific
Even industries that aren’t measuring KPIs now should expect to use them eventually to ensure success. However, there are specific ones to use for different sectors, which is why taking a universal approach to KPIs won’t work.
For example, in the air-compressor industry, companies may measure things like system pressure and power consumption. Unusual statistics could alert representatives about machinery that’s failing or needs maintenance.
Data governance experts should determine if their KPIs are the most effective to use for companies working in particular areas. After evaluating them, those specialists may realize the KPIs don’t track the most necessary data their business needs to perform competitively.
In other cases, it may be necessary to assess KPIs for certain kinds of information. For example, some industries, such as those that regularly record and keep customer records, may require different data governance KPIs than those that don’t handle personal data.
KPIs Should Add Value
When companies choose KPIs, they should steer clear of vanity metrics that look impressive, but don’t give information that directly correlates to their success. If it becomes clear that some KPIs have lost their former worthiness, that’s an indicator to discard them and come up with KPIs that are more appropriate.
Some vanity metrics measure things a company can’t improve because it doesn’t or can’t exert control over those facets. Those KPIs aren’t valuable, because they don’t lead to actionable steps that cause improved future metrics. Data specialists can ask, “So what?” to help determine if a KPI still has value. Does the KPI’s outcome support a business? If not, perhaps it isn’t useful anymore.
Timeliness Is a Key Component
If data governance professionals realize the data associated with a KPI is not available, measurable and available promptly, it does not meet the criteria for a good KPI.
A KPI that becomes exceptionally time-consuming to track needs assessment and possible changes to make it more effective. Companies may discover they’re tracking too many KPIs and causing a lack of timeliness. Or, the process for monitoring a KPI may be so slow it prohibits making timely decisions, warranting a reassessment of that measurement.
Regular Assessments Help Identify Problems
It’s a good idea to assess KPIs annually and track them at least every week. Regularly doing so makes it more straightforward to spot issues and fix them.
For example, members of the data governance team may realize too many of the metrics they currently measure don’t give information that helps the business grow. In the case of this problem or any other one, reassessment could remedy the issue.
KPI Assessment Fits Into Effective Data Governance
Making periodic assessments of KPIs is an essential part of responsible data governance.
Relying on the same ones for too long without verifying their worth could be harmful to the overall business, plus the people who handle and publish the company’s data.