Businesses have thousands of moving parts, and keeping track of what is actually important can often seem an insurmountable task for managers and small business owners. The reality of the situation is that every organization is unique, and an aspect of a business that is vital to one company may be completely useless to another. So how can managers gather all of the information they need to make big decisions while staying up-to-date?
The answer is Key Performance Indicators (KPIs). At their simplest, KPIs are a way for managers to track important statistics. When utilized correctly, KPIs are more powerful tools, able to compare various product, employee, and organizational variables and give suggestions based on their results. For field-based organizations that consistently deal with merchandising, sales, or servicing, KPIs can be particularly useful. Tracking patterns across a wide area has been difficult until the very recent emergence of Field Activity Management Software. Now reps in the field have the ability to collect real-time data on the-go.
To get a better understanding of how KPIs are applied to work in the field, we can use the following hypothetical scenario:
Bill is the founder and owner of a small orange beverage company named CitrusSplash. He currently employs 10 reps with the sole responsibility of visiting existing stores, taking purchase orders and performing retail audits. Each rep has an assigned territory consisting of a varying number of stores, and is expected to cover that area weekly. Although sales are up and most retailers seem happy, Bill is worried that some of his reps are underperforming. To address these suspicions, Bill uses a custom-made “Rep Territory Coverage” KPI.
To quantify his data, Bill gathers employee visiting data for an entire week and begins to input the data into his KPI. Bill sums the total amount of stores in all territories and divides it by the number of reps to get an average territory size. He then performs the same function with the number of completed visits. Dividing the average visitation by the average territory size gives an average territory coverage for the entire organization. Bill can now compare each rep’s performance against the company average and see what reps are lagging behind their peers in terms of productivity.
To take this one step further, Bill could have set his KPI to give recommendations based upon the rep’s current territory size, coverage rate, and comparison to average. Being able to input data into a responsive formula as you collect it means that managers can quickly react to changes in their environment. Whether that means changing working conditions for employees, reducing costs in certain areas of the business, or running one promotion longer than another, KPIs are a surefire way to quantify and better visualize the intricate happenings of any business.
For 12 in-depth & reactive KPIs that can help guide and inspire managers and business owners, download our free KPI Toolkit here. Adapting the tools within to fit your own organization is a fantastic way to start making data-driven decisions within your company.