Every strategy, employment or business processes have measures of success. Without a measure of success, it is difficult to evaluate the extent to which a person or a business process can be effective. Indicators of success in achieving the strategy is called by various names.
Kaplan & Norton (2004) called it a strategic measures and key performance indicators, while Simons (2000) called it a critical performance variables. The Government called Key Performance Indicators. I prefer to call Key Performance Indicator. Acronym is called KPI, letters in English spelling.
Determination of indicators of the success of the strategy, work or an actual business process needs of employers and employees. Business process productivity measurement is the answer to shareholders who desire feedback always want the health business. The existence of key performance indicator is the answer to the desire of employees who always want more objective measures in assessing the results of his work.
Whatever its name, as a measure achievement of the strategy, a strategic success indicators (strategic measures) are both necessary to meet the following elements:
Can be a means of communicating the company's strategy (ability of the organization to Communicate Their strategy for measures)
Directly related to the chosen strategy the company (the selected measure adequately focuses on the strategic issue)
The indicators are kuantifitatif, have a certain formula in its calculations (quantifiable, can be evaluated objectively)
Indicators can be calculated (the measures are quantifiable, and repeatable reliabled)
Pemutakhirannya useful frequency (the frequency of updates are meaningfull)
Target setting for improvement can be done (meaningful targets for improvement are established)
Possibility of benchmarking with other companies to do (external benchmarking is feasible and / or Desirable)
Measurement is still valid (validity of measures - not old unvalid measures)
Data and resources available (availability of data and resources)
Measurement does not exceed the cost of the benefit (cost of measures not more than the benefit of measures)
The idea of the above considerations is to ensure that companies choose indicators that meet the needs of idealism on the one side of the company, but on the other hand does not sacrifice practicality of implementation.
Morgan & Schiemann study in 1999 showed that "companies that succeed in business is a company that is also better in the management of human resources management system and measuring the productivity of their employees than other companies". And it starts with finding a quality key performance indicators and effective.