Key Performance Indicators (KPIs) are a type of performance measurement which evaluates the success of a business or a particular activity or process within that business.
KPIs should be used to measure areas where staff can have a direct impact and, as a process, should be fully supported by management. Regular and active discussion with teams on any improvement activities being undertaken as well as the issues involved, and actions being taken should be carried out.
Within the supply chain, KPIs measure how economically resources have been used as well as the effectiveness of processes. Insight is provided, by performance measurement systems, into the nature and workings of value-added processes.
Performance Measurement Systems (PMS), in order to be effective, should provide feedback on Customer requirements, Company capabilities and Supplier capabilities.
PMS frameworks should include both upstream and downstream performance and, in particular, non-financial and financial. For minimum standards to be achieved within competitiveness, five main areas of customer value should be set:
