Also make them agile by clearly delineating who is responsible for each metric in terms of IT versus business ownership. It is easy to say that the business really should own a metric. At the high level type of metrics, like profitability calculation or gross margin calculation, absolutely these should be created, measured, and monitored by the business stakeholders.
But if we go down the stack, the more detailed level metrics, things like customer counts, transaction volumes, these are also metrics and measures, and somebody has to own them. You have to understand where in that metrics stack, the lines of delineation are between what IT owns and what the business owns and governs.
So those are some of the best practices for effectively managing these metrics. Keep in mind the old saying, “Don’t try to boil the ocean.” Anyone who starts at the top level and says “let us define the key performance indicators for our entire enterprise, front-office, back-office, HR, finance, sales and marketing,” he is doomed to fail. The best practices call for finding the low-hanging fruit, something that can be implemented relatively painlessly and will achieve the biggest bang for the buck.
For instance, if you are suffering from low customer satisfaction, and you know you’re customers are leaving, then create a few metrics that let you monitor the reasons for customer satisfaction, the number of complaints, response time, et cetera. Quickly implement them; quickly get the ROI on the investment you have made focusing on those KPI’s. Then continue to chip away at the next pain points, never trying to tackle all the KPI’s at once.