The Most Important KPIs
By Chuck Violand
If you’ve been paying attention to popular business words lately, you’re no doubt familiar with one of the more prevalent terms being bantered around in business circles: KPIs.
The popular acronym stands for “Key Performance Indicators,” which are used to track all kinds of business performance metrics. Some KPIs are regarded as “leading indicators” of the financial performance of a company, and some are called “lagging indicators.” For example, if your company’s customer service rating (leading indicator) is habitually low, we can be pretty sure that eventually your company’s revenue growth and profitability KPIs (lagging indicators) will follow. And that’s not good.
There are all kinds of KPIs: Practical KPIs, Directional KPIs, Actionable KPIs, and even KPIs that take a degree in statistical analysis to understand.
Talking about KPIs at dinner parties or business events is fun and can make you sound smart. Start a conversation by saying, “Tell me, how are your KPIs tracking lately?” and instantly you sound like the smartest guy in the room. People overhearing your conversation will be quickly impressed with your command of business acronyms.
Recently, I was asked what I thought was the most important KPI to track. I’m sure my questioner was expecting me to tell them some important measure like EBITA, ROI, or Turn on Receivables, but I didn’t. I think there’s a more basic and important KPI to track, one that’s clearly a leading indicator of a business’ performance — showing up.
Seriously. Showing up! You don’t even have to be especially good when you show up, but you do have to show up. I marvel at how often people fumble this most basic of KPIs.
People don’t show up for lots of reasons. In today’s busy business climate, it’s easy to overschedule, double-book, or just plain forget appointments. We have emergencies that crop up or unexpected visitors that cause us to miss opportunities to meet and interact with people who might have been able to advance our business or career.
Battles have been lost when cavalries didn’t show up, romances dashed when lovers missed dates, and careers stalled after people overlooked important events.
Unfortunately, we don’t always get do-overs when we fail to show up. People and events move on, and opportunities are missed forever.
Showing up means showing up for work, for appointments, for meetings, even for phone calls. It means showing up when things are going well and, even more so, when they aren’t. Failing to show up proclaims to others that you’re weak, insincere, disorganized, or just undisciplined. Even if you are some of these things (And who isn’t from time to time?), you don’t want to broadcast it to everyone by not showing up.
In case you’re wondering what the target KPI for showing up is, it’s 100 percent. No guesswork required, and it’s easy to remember. If you want to enhance the performance of this KPI, try showing up on time! That gets people’s attention. Showing up stylishly late never works in business.
So the next time someone asks what KPIs you’re tracking, you can tell them the most important one: Showing up. Hopefully you can also tell them you’ve got it nailed.
Chuck Violand is the founder and principal of Violand Management Associates (VMA), a highly-respected consulting company in the restoration and cleaning industries. Through VMA, he works with business owners and companies to develop their people and their profits. Violand is the president of the RIA. To reach him, visit violand.com or call 800-360-3513.