Key Performance Indicators

7. Presentation

Management information needs to be presented in a way that makes the important trends easy to see.

You can achieve this by restricting the number of figures you monitor. But the biggest breakthroughs are achieved by clever use of computer-generated graphs and charts. The trends instantly become clear.

7.1 Specify which figures you wish to review, and when.

• Some figures need to be reviewed only once a year, as part of the annual budgeting cycle.For example, premises costs.
• Include 'red light' systems, to alert you to a particular danger or opportunity which could arise.
• For some businesses, exception reporting is a useful method.

7.2 Specify how you would like the information presented.

• A one-page summary sheet is advisable, backed up by detailed supporting information.The summary sheet could list the key performance indicators, such as total sales and gross margin, plus the top five drivers that you have identified.This forces you to concentrate on the issues which have the most impact on your business performance.
• The information can be ordered according to functions.For example sales, production and finance.
• Always present the actual figures alongside the standard figures (eg the budget and prior year), so comparisons can be made.

7.3 Whoever prepares the information should include a written commentary.

This explains any important changes since the previous period, including the reasons behind them.

• For example, sales might be low because a particular contract has been delayed.

7.4 Special attention needs to be given to any major projects or new areas of business.

• Problems usually arise. Identify them early on and take action immediately.