Saturday, January 31, 2015

Pitfalls of KPI Reporting

Pitfalls of KPI Reporting

Everyone in the business of IT Service Management is measured by a set of KPIs. People's performance is measured this way, process efficiency as well. There are some common pitfalls of reporting that you should be aware of and try to avoid.

Inconsistency

The need for reporting in many companies drives every department to prepare a set of reports showing their performance. Problems arise when those reports are produced in isolation. Different layouts, which make it difficult to compare results, are a minor problem if you take a look at other inconsistencies.

Various departments may have their own set of criteria for data selection, which makes comparison of results impossible. What happens if various departments need to provide the single version of truth to senior management? Numerous reporting consolidation sessions take place, taking away time from other important activities.

It would be much easier to drive consistency on a regular basis, wouldn't it? Establish certain ground rules between teams and follow them.

Manual Effort

The hunger for data can grow so large, that it will eventually exceed the capabilities of standard reporting available within the company. People will begin dumping data from databases to spreadsheets and manipulate it in every possible way.

This becomes purely individual effort. The company may even fund Excel trainings to make the users more "advanced". Long live excel macros. The effort is very solitary, isolated in various parts of the company. No integrated reporting, no consolidated requirement gathering. Report generation is very labor-intensive.

That is expensive, but it does not seem so at first glance. Having a good reporting tool seems to be an unnecessary overhead. In reality, the reverse is true in many cases. Also, manual process drives further inconsistency.

Impact on System Performance

There is a direct correlation between lack of good reporting solutions and number of performance incidents in transactional systems. The more your organization relies on reporting directly from the live databases, the more incidents you are going to get. The more distributed and ad hoc the reporting, the less stable are your systems.

Do you still consider a good reporting solution (and a process) a "nice to have" requirement? Well, think twice. There are companies which have reclassified some of their reporting systems as mission critical. The management needs data to make vital day-to-day decisions. Apparently, sometimes it is as important as having the sales system up and running.

While normally KPI reporting is not a mission critical activity, it can impact your organization more than you think if done incorrectly.

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