These days, companies are inundated with data. There are often too many measurements, and not enough action. As a result, data can be boring and uninspiring.
This is where visual storytelling comes in. Through visual storytelling, you can streamline KPIs, and turn them into KPYs that are easy to communicate, inspire your audience, and create tangible actions that can be tracked and measured. In other words, by creating actionable KPYs, you can achieve your company’s goals.
In this document, I’ll show you how to do just that. Let’s get started…
What’s a KPY?
A KPY puts the ‘Why’ in a KPI. Think of it as a smarter, more advanced form of a KPI. It not only indicates what the measurement is, but it specifies what action you want to take, how much you want to achieve, and when you want to achieve it.
There are four steps to converting your KPIs into KPYs:
- Identify your top 3-5 KPIs
- Transform your KPIs into KPYs
- Tell your KPY story
- Track your KPY results
Step 1: Identify your top 3-5 KPIs
Determine the KPIs most critical to your company’s success.
If you have too many KPIs, it can be difficult to track them all. Less is more when it comes to gaining value from your data. To be effective, have no more than three to five KPIs tied to a single goal at any given time. The quickest way to identify your top 3-5 KPIs is by doing KPI purging: ranking and reducing your KPI count based on their weighted impact.
Create a Spreadsheet
To do this, create a spreadsheet with four columns: Rank, Weight Impact %, Top KPIs and Metrics. Include your overall business goal to the right, and make sure to only include KPIs that directly align with that goal. The spreadsheet could look something like this:
Assign a Weight Impact %
Once you’ve listed all your KPIs, assign a percentage to each one, based on the impact you expect it to have on your goal. All of the percentages should add up to 100%. If you have any KPIs that weigh less than 10%, move them to the Metrics column. (More on that later.)
Reorder the KPIs
Once you’ve assigned a Weight Impact %, reorder your KPIs from highest to lowest percentage. Here’s what your spreadsheet may ultimately look like:
Now that you’ve identified your top three to five KPIs, they’re ready to be transformed into KPYs.
Step 2: Transform your KPIs into KPYs
Rename your KPIs to define and quantify the action they should take.
A KPY should enable people to easily understand the following components:
- What the KPY action is
- How the KPY is being measured
- When the KPY action should be taken
- What the KPY success looks like
If you can’t define all the KPY components, the KPI can’t be converted to a KPY. Move it to the Metrics column of your KPY Analyzer Sheet. Don’t be afraid to purge KPIs. Focus more on the metrics that matter, and less on those that don’t.
Define the KPI Action
To convert your first KPI to a KPY, start by answering this question: what KPI action needs to be taken to reach your goal?
In the example below, the KPI is Sales. But the action is to Grow sales.
To create compelling KPYs that inspire action, use verbs that are more visual, intuitive and action-oriented; try to avoid dry business jargon. That’s why, in the example above, I’ve used the word Grow instead of, say, Increase.
Determine How Much Should Happen
Next, quantify how much sales need to grow.
I recommend using both a number and a percentage. This makes it easier to understand and creates a clearer target. If a quantity doesn’t exist, simply skip this part and move to the next step.
Decide When It Should Happen
Now, set a clear deadline for growing sales by 10%/$100K.
When setting a deadline, specify the month and year (and, potentially, even the day). Open-ended deadlines are hard to achieve (for example, “by end of year”). In addition, assigning a specific date makes it easier to break the KPY into smaller goals over shorter periods of time.
Repeat this process for every KPI, until they are all transformed into KPYs. You’ve now created actionable metrics that are easy for users to digest and use in their everyday jobs.
Step 3: Tell your KPY story
Use your KPYs to tell a compelling story and inspire action.
KPY stories are powerful. They’re one of the most effective ways to communicate data and gain buy-in from your audience, making people more inclined to take action. They also provide tangible actions that are easier to track. Finally, KPY stories are great tools for communicating to management.
Create a Visual Storyboard
Now you’ll create a story for each KPY. Every KPY story should have three distinct parts: KPY, Trend and Action.
Identify KPY Trends
For each KPY, ask yourself what is causing it to be below target. This will help you quickly identify your trends. You may want to review your supporting metrics to determine the reasons. (This is where you can refer to your metrics from the KPY Analyzer Sheet in Step 1. In the example below, I’ve brought back Purchase Volume and Close Ratio from the original spreadsheet.)
Define KPY Actions
In the next step, indicate how to fix the problem. List the action(s) to be taken by the KPY owner (the person who’s responsible for its success), to bring the KPY to its desired state (which is typically on or above its target).
When fixing the problem, you may take several actions. They may be as simple as Call the manager, or as complex as Reduce staff. Focus on actions that are realistic.
Continue to repeat this process for each KPY, completing all three sections for each. Ultimately your storyboard could look like this:
Step 4: Track your KPY results
Make your KPY stories work for you.
The key to measuring the effectiveness of your KPY story? Assigning accountability, making deadlines, communicating with KPY owners and creating check-ins. Here are some tips for doing that:
Indicate who is responsible for each KPY and/or each of its actions. This creates accountability and makes it easier to address any issues.
Break Down Deadlines
Break your KPY targets into smaller targets with shorter time intervals (e.g., monthly, weekly, daily). (For instance, I’d break the above target of three months into smaller weekly or monthly targets.) This creates immediate actions for the KPY owners, encouraging accountability and proactive behavior. It’s easier to keep a KPY on target when it’s being closely tracked.
Make it Visible
Create a shared document so everyone has access to their KPYs. Be sure to provide access to the whole KPY story, to ensure the big picture is not overlooked. This is where a tool such as SAP Analytics Cloud can be useful.
Adjust KPYs as Needed
Over time, as you monitor and track your KPY, feel free to revisit Step 2 and 3 to change your KPY name, trends, or actions. A business can change rapidly, so be realistic. Make sure you also keep your KPY story up to date.
Create Regular Check-ins
Set up regular status meetings to monitor deadlines, check on progress, discuss any issues or revisit your KPY targets. Make sure all KPY owners are at the table. This is a great way to keep everyone aligned and focused on the same goal.
As you can see, creating KPYs and creating data visualizations is a powerful step toward achieving your goals. And the more you go through this process with your KPIs, the easier it becomes to make your data more actionable.
As the co-founder of BI Brainz, a global business intelligence consulting and education firm, Mico Yuk has helped hundreds of executives and managers around the world develop new insights from their data by harnessing the power of data visualization and visual storytelling. Her clients include Nestle, McKesson, FedEx, Ericsson, Kimberly Clark, Conoco Philips, Qatargas and Royal Dutch Shell.
For more information about BI Brainz’s services and courses, please visit http://bibrainz.com/our-academy.
Today we receive 5X as much information as we did in 1986.
The majority of that data is visual and most people don’t know how to present it. The opportunity lies in becoming better visual storytellers and utilizing the data to illuminate the message. Use the Data Visualization Handbook to easily transform your KPI data into knowledge.