The implementation of KPIs (Key Performance Indicators) is a major concern. Within HSEQ and CSR/ESG management, dashboards shed light on the functioning of their processes. Internally, KPIs can be excellent data to communicate. Therefore, which indicators should be chosen? And how to use them?
The ISO 9001 v2015 standard does not explicitly require the implementation of KPI dashboards. Nevertheless, Clause 6.2.1 specifies the following:
"Are quality objectives measurable, monitored and updated? "
Moreover, the company must keep documented information as evidence of the achievement of objectives.
Why implement KPIs?
KPIs are performance indicators. To measure them, every organisation shall analyse the effectiveness, efficiency and performance of its activities.
- Effectiveness verifies the achievement of the objectives set.
- Efficiency ensures that the company has achieved its objectives at the lowest cost with minimum resources.
- Relevance shows whether the company has equipped itself with adequate means to achieve its objectives.
KPIs serve managers and concerned employees to verify the effectiveness of their actions and facilitate decision-making accordingly. Therefore, KPIs are closely linked to the company's policy and strategy.
How to choose your KPIs?
A good indicator must be linked to an objective: there is no point in defining a panel of indicators that have no purpose! Indeed, if the objective is too vague (for example, by defining an indicator simply called "improvement of employee well-being"), the dashboards will not be precise and therefore inefficient.
To help you set objectives, rely on the SMART method: it consists of identifying objectives over a defined period. The SMART method has five criteria: "S" for "Specific"; "M" for "Measurable"; "A" for "Acceptable and Ambitious"; "R" for "Relevant"; and "T" for "Time-bound". The idea is to set concrete and achievable objectives and to measure them using an indicator.
Thus, to evaluate employees' well-being, it will be necessary to define indicators such as "absenteeism rate", "punctuality at work", "participation in company events", etc.
It is important not to define too many indicators and to avoid building overly complex systems. The performance of an approach is not measured by the number of indicators but by the objectives achieved. The chosen KPIs must be easy to implement and communicate.
Therefore, the most commonly chosen representation modes are graphs, as they have the advantage of being very visual and accessible to everyone. Make sure to display the dashboards internally, whether on bulletin boards or the company's Intranet. Of course, these can be commented on and explained to each department.
What are the key indicators to use?
For the management
Management has key performance indicators for all products and associated activities. Here are some examples of indicators:
- Monitoring expenses and investments;
- Absenteeism rate;
- Occupational accident/illness rate;
- Payroll and staffing changes;
- Revenue/Turnover growth;
- Invoice tracking and payment deadlines, etc.
For the HSEQ department
The HSEQ department has its dashboards consisting of both performance indicators and monitoring and management indicators.
Management indicators include:
- The number of audits carried out;
- The number of quality meetings/management reviews organized;
- The number of action plans in progress, etc.
Performance indicators include:
- The customer satisfaction rate (via customer satisfaction mapping);
- The costs incurred by customer complaints;
- The average production time;
- The product compliance rate;
- The delivery compliance rate, etc.
For CSR and ESG managers
- Employee retention rate;
- Achievement of objectives in terms of strategic positioning on markets;
- Greenhouse gas emissions;
- Incinerable waste rates compared to recoverable waste, etc.
For process managers
Process managers monitor indicators related to the activity/process they are responsible.
Here are some examples:
- Scrap rate on a line dedicated to the process;
- Compliance rate with deadlines;
- Number of deliveries rejected by the customer;
- Number of completed actions on the action plan;
- Non-conformity rate detected on the process, etc.
Key indicators: how to manage them?
If the HSEQ manager has the reflex to open the spreadsheet to track, report and consolidate your key data, it means your IMS and/or QMS is not fully digitized. Don't panic, there is still time to equip yourself with a dedicated management solution to monitor the processes and key indicators in real time.
Indeed, with a dedicated platform (such as BlueKanGo), all data from the field will generate accessible and exploitable real time statistics. It is even possible to produce automated reports (using Business Intelligence type tools) that represent key indicators in fully customized graphs. This is a significant time saving for preparing management reviews or simply for reporting your activity. This aspect is even more important as legislation takes a step forward by demanding the dematerialization of data, particularly regarding Risk Assessment, Safety Passports, Energy Audits, and even ESG indicator tracking.
By anticipating the process, you will no longer have to chase after figures: they will be directly exploitable.
To conclude, each company and department chooses its KPIs based on its activity and its priorities. Given the competitiveness stakes, it is now difficult to ensure optimal monitoring of your key indicators without digitizing your management system, especially since many indicators must now be archived online. So, are you ready?