Open-book management is all about shared knowledge. And in my fifth post about open-book management, I want to talk about key performance indicators. Everyone notices something in their job.
There is a metronome ticking that isn’t necessarily our accountabilities or tasks but it is how we notice the key to our success, our key performance indicators.
- A barista at Starbucks may be making cappuccino but she is counting the number of cups lined up to be filled.
- A sales rep may be responsible for dollars sold per day but he counts sales calls.
- A shipping clerk must fill orders but is counting boxes completed.
I am always amazed and surprised when working with teams to find out what is their key performance indicators are for each individual member of the team. Even if team members have the same or similar accountabilities, each person notices something different. It is in the discovery and sharing of these key performance indicators that everyone learns what else is important to the business and how each person adds value.
In this video, I tell the story of how one such team built their KPIs and started to think in new ways.
A typical business practice is for management to chose a few relevant financial indicators, add a couple industry specific indicators (such as billable hours for a law practice or job cost for a contractor) and then build goals around them. This is a good practice. But to create a transparent company using the open-book management system, everyone needs to contribute and understand how they can impact the results.
To create a transparent, open-book company, everyone contributes and understands how they can impact the results. That is why taking time with your team to discover your own key performance indicators is so powerful. Then you can impact and track financial, industry, and personal performance indicators.
Take this blog post with you and listen to the podcast version: