Performance indicators Flashcards
What are performance indicators (KPI)
Specific criteria used by a LSO to measure the efficiency and effectiveness of the organisational performance
Why use them
Continuously examine how the business has been preforming against goals
Determine the resources (money, employees, materials) are being used property
To allow for change
To evaluate and management
Define Effectiveness
The degree to which an organisation has achieved its stated objectives
Define Efficency
How well an organisation uses resources to achieve objectives
I.E Maximising output whilst minimising inputs ( faster, cheaper)
Example of a KPI ( Level of wastage * operations )
The amount of waste created by the production process
If high, indicates organisation is inefficiently managing resources, increasing the cost of production and thus lowering profits
If low, indicates organisation is managing resource more efficiently by reducing waste, which can cut production costs and therefore increases profits; positive impact on the enviroment and community attitudes
Example of a KPI ( Number of workplace accidents)
How safe the workplace is for employees ‘
if high, indicates a unsafe workplace which may lower staff morale and affect the productivity of the organisation
If low, indicates a safe workplace for staff, which may increase, staff motivation and increase productivity
Example of KPI ( number of products sold * marketing)
the number of product sold
If high, organisation is running profitability, indicating their strategy has been successful
If low, organisation needs to implement new strategies to improve
Example of KPI ( Results of a staff sanctification survey * Human resources)
How satisfied staff are within the organisation
If high, indicates employees are satified with the way they are being treated and how organisation is running
If low, indicates the staff are not happy with their treatment withi the business and have a poor relationship with their employees
