Key Performance Indicators.
We hear so many businesses talk about them and what they consider to be their critical KPIs.
Sure, they have indicators and measures but how many really pick the right ones?
A KPI should be a measure of how to improve performance not the result such as increased sales.
Probably one of the best exponents of KPIs has to be Ryanair.
One of their most sacrosanct KPIs is a maximum of 25 minutes for aircraft turnaround at airports.
This means disembarking all passengers, unloading baggage, cleaning, restocking and refuelling the aircraft, carrying out basic maintenance and safety checks, loading new passengers plus their baggage and getting the aircraft moving again in less than 25 minutes.
So, as they’ve increased their aircraft size from carrying 130 passengers to 197 and soon to 228 what is the constant factor? Yes, a maximum of 25 minutes turnaround.
Aircraft earn revenue from flying passengers not from wasting time on the ground and Ryanair’s approach highlights this.
So, if a multi-billion turnover business uses a critical KPI of a 25-minute turnaround what might your business use?
If you are using any financial metrics, then you are measuring the outcomes not the result drivers.
To move the business the key measurements need to ones that will make a real change.
They need to be performance not result indicators.
I’d be very interested to hear what you consider your key “25-minute turnaround” indicator for your business and whether it separates you from your competitors.
