Key Performance Indicators – KPIs are the dashboard used by leadership to make decisions as it relates to performance.
Like a dashboard on a car, if an owner or manager spend their time staring at the dashboard, the car will end up off course and will crash. They are merely an indicator, not an end unto themselves. The indicators should result in any necessary changes to people, process, and profit to improve a company’s health. Don’t fall into paralysis by analysis.
Daily KPIs are 2-3 numbers looked at to see if the actual work is on target. These may include daily revenue, work in progress/percentage of completion, cash received, cash disbursed, bank balances, receivables, payables, etc.
Weekly KPIs may include such items as accounts receivable past due, accounts payable past due, lead generation indicators. Looking at lead generation indicators is a lag indicator that generally would not be reviewed more than weekly
Monthly – P&L, balance sheet, cash flow statement, bank reconciliations and bank statements. Comparative financials and trending metrics
Quarterly - Comparative financials, trending metrics, tax planning
Annual – budget to actual spend and preparation of budget for next year, final tax planning
