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Having the right Key Performance Indicators (KPIs) on your CEO dashboard is very important to ensure you drive the right behaviors in your business, monitor the right results, and make the right adjustments to grow your business and hit your targets. I often get the question, particularly with new clients that do not have KPI dashboards established, “What KPIs should we be tracking?”
And here comes the time-honored consultant response, “It depends.” I know—I am being a bit facetious, but it does depend; it depends on the type of business, the maturity of the business, what problems you are trying to solve, what things you are trying to improve as well as who your stakeholders are. I could go on, but I am sure you get the point (read more: Why are KPIs important?). That said, I believe some KPIs should be on most CEO or leadership team dashboards.
Kaplan and Norton put themselves on the proverbial map with their work in The Balanced Scorecard. Their four perspective categories are Financial, Customer, Internal Business Processes, and Learning and growth. It is important to have the right mix of KPIs to run your business holistically and balanced. I believe it’s important to balance revenue growth, profitability, and improving processes and procedures while investing in your people. At Rhythm, we provide a scorecard view using the categories Employees, Customers, Revenue, and Processes (in addition to the option of customized categories and dashboards for your KPIs).
I recommend 3-5 KPIs in each of these four categories with a balance of leading indicators and results or lagging indicators. Personally, I think leading indicators are even more important to drive the behavior you need to get the results you are looking for. With that in mind, take a look below at some suggested KPIs in each of the four categories that I think are important and have seen many of my clients use through the years.
Employee CEO KPIs
- Employee satisfaction
- Employee turnover
- Employee training
- # of High-potential employees
- # of "A" Players
- Attrition (voluntary)
Customer CEO KPIs
- Customer satisfaction (Net Promoter Score)
- # of Customer complaints
- Customer retention
- Customer churn rate
- New account revenue
- Customer lifetime value
Revenue and Sales CEO KPIs
- Revenue
- Gross margin
- Net margin
- EBITDA (Earnings Before Interest, Taxes, Depreciation, and amortization)
- Innovation dollars invested
- Cashflow runway
Process CEO KPIs
- Revenue per employee
- Operating efficiency
- On-time delivery or fulfillment
- Inventory turnover
- Quality (rework, defects per XX, etc.)
Bonus CEO KPIs that I offer for your consideration:
- New Leads/Opportunities
- Customer acquisition cost (CAC)
- Sales calls made
- Number of Face-to-face sales or customer visits scheduled
- MQLs – Marketing Qualified Leads
- SQLs – Sales Qualified Leads
For those of you creating your CEO KPI dashboard, please consider the suggestions above, and add to the list or edit it to fit your unique business and challenges. If you have other KPIs that you believe are non-negotiable, please share them so that others may learn from your experience.
Now that you know your numbers, where should you spend your time? What should a CEO focus on is an insightful blog post that will help you schedule your time.
