What's your KPI?
Asset Management, a key function, has a strong potential to influence the success of the mainstream business. However, it seems ironical that it has received little or no strategic importance. The scope of Asset Management had been limited to short or midterm goals which seldom tied back to the strategic business goals of the Organisation. Adding to this agony, very few attempts focused on identifying gaps in its orientation towards the overall business goals. One of the reasons for this loose integration I think is the overbearingness with self-centered KPIs. We all know the importance of Metrics, KPIs offers us exactly this. Firstly, it baselines the factors determining the success of an action and finally concludes with the actual measures on how one performed against these set yardsticks. Being comprehensive is very important while aligning the objective span across line of action contributing to overall success of a program. What limits this then? There are few challenges which I think needs to be accounted for
Give personal bias a rest: Devising a KPI is a challenging affair, overcoming bias adds to the challenge. It is very important to understand the underlying bias factor. There is a tendency to overly focus on parameters which ensures maximum equipment uptime. But, can a zero fault asset run a business successfully? Should we not worry about how effectively these Assets are made available to business? My equipment billing, my equipment utilization, my inventory etc. are some of the parameters which invariably finds top slots among the Asset Managers, KPIs devised on these premise are naturally biased with little or no focus on achieving the overall objective of the business. For instance, opponents of lean philosophy, if not for other debatable aspects of lean, will surely bank on its ability to bring the focus back to the overall business value creation. Lean stunned the Manufacturing business with its disruptive ideologies and transformed the KPIs to a greater extent, the same applies here. If the KPIs has to work, then it has to work for the business and should not get limited to promoting individualistic goals.
Interact with your ecosystem, break the "Status Quo" cocoon: It's natural to like things working in a streamlined way, disturbing the flow of activities especially if things are smooth is not desirable. However, I think this very attitude has resulted in resistance among folks to look for change and eye beyond their comfort zone. This has also limited them to come up with something disruptive and something which goes beyond their departmental goals. For example, in the race to ensure a cent percent equipment uptime, managers hoard on expensive maintenance packages. The activity becomes so inward looking and so focused on meaningless targets that it loses the overall objective of the program and eventually gets shot down for lack of funds while getting labeled as an expensive cost center to sustain! Furthermore, a common problem is "fear of authority" creating resistance to oppose change, but trust me - "the authority" inherently loves challenges and fresh ideas even though such actions create conflicts. Subconsciously, we all love to experience disruption, it's just the fear to challenge the status quo that leaves us behind, don't think so? Try finding a movie script or a TV soap with all happy-happy events, there is a high probability that you might relate to what I am talking about.
Master the Convincing Act: The first one to be convinced is yourself! If you are the decision maker who influences the direction in which the actions are swayed, it's important to be convinced that these actions are going to yield a comprehensive result and are in best interest of the overall business. Once fixed, it is important to allow the ideas to be percolated to the actual actioners so that they adhere to the metrics, however this cannot happen unless they know that their actions are yielding anticipated benefits. As an Asset Manager, it is important to align KPIs which will integrate the Business strategy to a smart implementation plan, a convinced actioner will do wonders in ensuring a seamless implementation!
Be latest, context driven and improve continuously: A must thing I must say, gives you a chance to introspect and evaluate, something which is critical factor in success of any KPI. A continuous improvement plan will not only ensure the validity of the KPI in the changing business context but will ensure sustainable and credible model to follow.
Let's open up while defining our performance indicators, let's stop choosing some strong holds to thrive on , otherwise for all that you know, a high rate of success on an individualistic level might not do an overall good!