KPI pitfalls you want to avoid
Using KPI's is a good thing!
KPIs are vital for multi-unit businesses, providing clear metrics to gauge performance and drive growth. They help you track everything from sales and customer satisfaction to operational efficiency, helping each unit reach their business goals. But choosing the right ones is crucial. Check out our post on the “5 KPIs succesfull chains use” to discover which metrics make a big impact.
So we encourage you to track down important KPIs on a daily basis, so that you can make your business healthy and profitable, effortlessly.
Common KPI mistakes
Working with KPIs in the wrong way, can harmfull for your business. It’s like doing sport… sporting is a good thing, untill you do it wrongly or excessively. Than the consequences are less pleasant.
Here are some KPI mistakes that always result in a loss of time, money and energy.
1. No link between KPIs and strategy
KPIs are only useful if they align with your strategy and guide your decisions. Otherwise, they’re like burned toast. When KPIs aren’t tied to your strategy, you waste time and money collecting data that doesn’t benefit your business.
KPIs should deliver mission-critical information relevant to your goals. For example, if your priority is focussed on customers, then speed of service or customer happiness is an important KPI. Once you know what you want to achieve, use those objectives to select the right KPIs. This way, your KPIs will truly help you reach your goals and drive your business forward.
2. Monitoring too many KPIs
Working with too many KPIs at once is a common mistake that dilutes your focus and effectiveness. Juggling numerous metrics can overwhelm your team and distract you from what’s truly important. Instead of spreading your attention thin, focus on just three KPIs on a daily basis. This concentrated approach allows you to monitor critical areas closely, make informed decisions, and take effective actions. Once you’ve mastered these key metrics, you switch to other KPI’s, that help you solve the next challenge.
By keeping it simple, you ensure each KPI serves a clear purpose and has the expected impact.
3. Overcomplexing KPIs
Visualizing KPIs with too many graphics and charts is a big mistake. While fancy visuals with trendlines and colors might look impressive, they actually distract you from what’s important. The key is simplicity—if you can’t quickly determine within 0.7 seconds whether action is needed, your KPI visualization is too complex. Keeping visuals straightforward helps you focus on the essential data and make swift decisions, ensuring that your KPIs are both effective and actionable.
4. Measuring what others measure
A common mistake is copying what everyone else is measuring for KPIs. Just because other businesses are buzzing about productivity, strike rates or labour mix, doesn’t mean you need them too. It’s like buying a new gadget just because your neighbor did—you don’t need a blender if you’re not selling smoothies. Focus on what fits your own strategy, not what’s trending.
5. Not acting properly on your KPI's
KPIs are only useful if you actually act on them. Think of KPIs like a map: you can have the best one out there, but if you don’t use it, you’ll still be lost. It’s not just about setting targets; it’s about analyzing why you’re missing them and taking action to fix it. Make sure your KPIs guide real decisions and improvements—otherwise, you’re just making pretty charts.
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