Wood letter of KPI abbreviation with hand writing definition
The key to assessing the health of your business…
CEOs need easy access to a few key performance indicators to monitor how healthy the business is at a given point in time.
It’s imperative to identify a handful of metrics that the CEO needs to see daily or weekly.
These metrics should tell a quick story and give insight into both external and internal trends. This blog provides KPI Examples for your leadership team.
Which KPIs belong on a CEO’s KPI dashboard?
Business leaders need to keep up-to-date in real time (or as close as possible) so that they can have the actionable insights needed to make adjustments to their priorities.
Here are some examples of KPIs that a CEO should be watching for their leadership team: CEO/Owner
“A” Players on the Leadership Team – the goal would be to have at least 75 percent of the Leadership Team be considered “A” players.
Net Cash Flow %
Return on Investment (or Assets) %
Brand Promise Delivery
Net Promoter Score
Repeat Customers % (The goal is to have at least 95 percent of existing customers become repeat buyers)
Leadership Team Development Plans – 100% complete
Profitability
EBITDA
Market Share
Marketing Leader
Leads Generated #/ month
Cost per Lead
Brand Awareness >percent
Promotion Effectiveness / ROI +%
Trade Show ROI +%
New Customer Acquisition
“A” Players on the Team – the goal would be to have at least 75 percent of the Team be considered “A” players
Marketing Team Development Plans – 100% complete
Sales Leader
Sales Pipeline Value / Conversion %
Leads Converted #/ month
% of revenue goal
Year over Year Revenue Growth (New & Existing Clients)
Sales Efficiency Ratio $? /$1.00
Market Share Growth + percent
“A” Players on the Team – the goal would be to have at least 75 percent of the Team be considered “A” players
Sales Team Development Plans – 100% complete
Operations Leader
Gross margin %
“A” Players Retained %
Internal Hires for Open Positions %
Customer Visits per Quarter
“A” Players on the Team – the goal would be to have at least 75 percent of the Team be considered “A” players
Operations Team Development Plans – 100% complete
Financial Leader
Return on Invested Dollars – percent
Accurate Budget Forecasts ± 2.5 percent
Accounts Receivable Days < 30
Cash in hand for operations
Level of debt as % of total Assets
Financial Literacy of Leadership Team 100 percent of team
“A” Players on the Team – the goal would be to have at least 75 percent of the Team be considered “A” players
Financial Team Development Plans – 100% complete
Human Resources Leader
Regrettable Turnover < 1 percent (Regrettable Turnover is the percentage of people who leave the organisation but whom you did not want to lose?)
Open Positions < 5 percent
Absence time, Engagement level
Management Efficiency Ratio $10.00/$1.00 (Management Efficiency Ratio is measured by how many contribution-margin dollars are generated for every dollar of the management team’s salary.)
Employee Net Promoter Score (NPS)
“A” Players on the Team – the goal would be to have at least 75 percent of the Team be considered “A” players
Labour Efficiency Ratio $?/$1.00 (Labour Efficiency Ratio is measured by how many gross-margin dollars are generated for every dollar of direct-labour salary.)
Machine Utilisation Rate – %
Days Lost Due to Injury – 0 days
Quality / Bugs
“A” Players on the Team – the goal would be to have at least 75 percent of the Team be considered “A” players
Manufacturing Team Development Plans – 100% complete
“A” Players on the Team – the goal would be to have at least 75 percent of the Team be considered “A” players
Legal Team Development Plans – 100% complete
Innovation Leader
Products Developed on Time ± 1 week
Products Developed on Budget ± 2.5 percent
First Year New Product Market Share – 20 percent
Accurate Product Market Forecasts ± 5 percent
“A” Players on the Team – the goal would be to have at least 75 percent of the Team be considered “A” players
Innovation Team Development Plans – 100% complete
Purchasing/Supply Chain Leader
Reduction in Cost of Goods Sold – 5 percent
Days Lost Due to Product Shortage – 0
Supplier Mistakes
Supplier Quality Ratings +90 percent
Material Quality Specifications – 100 percent
“A” Players on the Team – the goal would be to have at least 75 percent of the Team be considered “A” players
Purchasing/Supply Team Development Plans – 100% complete
I don’t think it is an accident that successful CEOs are watching KPIs that fall into one of the 4 categories:
Customers – Do your customers love, appreciate, and refer you?
Employees – Are your employees engaged, productive, delivering results, and excited about the future?
Revenue – Do you have the right product/service offerings and marketing/sales strategies to support your current and future revenue goals?
Processes – Do you have healthy operations and disciplines that you can scale for the future?
Thinking about your business, what Customer, Employee, Revenue, and Process KPIs are key for your company’s success?
Your list will be unique and based on your industry and specific goals. However, the ideal KPI dashboard for CEOs should include one or two metrics from each of the four key areas to ensure a balanced scorecard of your company’s success.
Keep in mind that there may be more than KPIs on your CEO dashboard.
You’ll also want to keep an eye on the key projects – or quarterly rocks in Rockefeller Habits – that help drive your numbers towards your strategic plan.
For example, if you are implementing a CRM to improve your sales KPIs, you’ll want to make sure that you keep track of that project on your dashboard as well.
This will ensure that you are not only looking at the key numbers, but you’re also looking at what you are doing to improve those numbers.
This will give the Executive and Management teams the performance dashboard that they need to keep the business performing at a high level.
I want to acknowledge 2 key sources for this blog:
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