If you happen to hit this article first without going through my other articles on KPIs, the idea of KPI cadence might make sense. But chances are KPI time frame might not register.
Let’s take these two elements of time and KPIs and work out the kinks.
KPIs Have a Cadence
Key Performance Indicators have a natural cadence to them. Actually, in my book, there’s a formal cadence and an informal cadence.
When I coach clients, we absolutely establish a formal cadence of KPI review, monthly. That is, we have an established ritual every month wherein we review KPIs against plan for actual performance, calculate variance, celebrate success, and apply any corrective action needed for any short falls. This process is absolutely critical to transforming KPIs from a “make work” exercise to a critical piece of managing the business and transforming performance.
The reason this is a “formal” cadence is because:
- This is a planned ritual, calendared for all involved, and sacrosanct: It must happen without fail.
- It is recorded for posterity, becomes part of the company record, and is referred to as a historical record. It is “official.”
That is not to say we don’t look at performance more frequently. We absolutely do. That’s where the informal cadence comes in.
Some teams and businesses look at KPIs as frequently as daily. Sales organizations are a great example. Software development teams are another. Still other teams may review KPIs weekly, bi-weekly, etc.
These reviews are very important and can be critical to running the business. Some may even become Formal in their own right. Most, though, are not. Most are simple checkpoints to check progress along the way.
They key difference is what’s done with the information.
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When Used as Strategy, KPIs Need a Time Frame
You can bring KPIs into your strategic planning process by giving them a goal.
Anytime you’re going goal setting, that’s where having a time frame comes in (remember the “T” in SMART stands for “time-bound”). So let’s get specific about what makes for a good time frame with KPIs.
Here at Pivot Habit, I coach my clients to:
- Forge a 10-year vision.
- Look ahead 3 years.
- Build a clear 1-year plan.
- Calibrate quarterly.
- "Plan to Pivot" monthly, making small course corrections to maintain strong control over performance.
Coming back to KPIs, the question of which KPIs we measure and how should seldom change. The slate should be stable, changing only by need.
The real issue of time frame comes to goal setting for KPIs we’re using in strategic planning. My advice is the same as with all other strategic planning time lines: Aim for most goals to fit ideally within one or two quarters, and none longer than a year. This aligns nicely with your planning and review cycle.