Ray
Charles' KPI
by
Tom Pryor
If you've seen Jamie Foxx's Oscar-winning performance in Ray, did you notice the key indicator Ray Charles used to maintain control of the band every night? It was his left foot!
Every drummer whoever played with Ray Charles was given one commandment. "Watch my left foot". When the drummer set up for a concert, he made sure there was a line of sight to Ray's left foot.
According to drummer John Bryant, "Ray couldn't watch a conductor, and he wasn't able to look into the eyes of his musicians to send a message. Instead, Ray's feet were his stomp of approval. When the sole hit the floor, it was ground zero. The downbeat and the correct beat. The beginning, middle and end of his musical expectations were conducted with his left foot." [1]
What key performance indicator (KPI) sets the tempo for you or your organization? For the band, Ray's left foot was the KPI. Successful people and organizations have KPI's. Here are several examples from a variety of successful leaders:
- Steve
Strifler, president of Cisco-Eagle says, "First
thing everyday I look at our bookings report. Second thing is our 'opportunity/proposal'
log. Those are the two every day items."
-
Jim Elliott, consumer web services manager for Ford Motor Company says,
"Volume of referrals from the www.Ford.com
corporate portal to vehicle brand web sites is Ford.com's most critical
KPI. Ford.com is at the top of the purchase funnel and these folks gather
information and many eventually wind up at a dealership purchasing a
Ford product and generating revenue for the company."
- Bob
Doig, president of Doig Corporation, a Wisconsin-based fluid power distributor,
uses a hotel bell as a KPI. "When a customer
service rep takes a customer order with a gross margin profile of $1,000,
they ring the bell one time. If the margin is $2,000, the rep rings
it two times. When I hear the bell ring during the day, I know sales
and profits are going well."
-
Tom Akright, director of Activity Based Management for Ralston-Purina,
says daily tempo is set by "Daily Orders,
Shipments, On-Time Delivery and Order Accuracy/Fulfillment."
-
John LaHue, associate director for the Department of Veterans Affairs,
uses a daily meeting to set the tempo. "Tom,
one of the things I do every morning at 8am, is have a meeting with
my senior staff. It only lasts as long as it needs to (usually 30 minutes),
and I convey to my managers what I believe needs to be accomplished
that day and what is coming up for discussion at the executive level.
In turn, my managers update me on things that they are working on that
they know I need to be current on, or where they need my help or have
a question. Having that daily meeting has been a good way to help insure
effective communication and problem solving. It's also something the
staff can routinely count on, so no matter how chaotic it gets, there's
some modicum of stability. It also helps set the organizational tempo
for the day."
-
Mega-church pastor Barry Cameron says he measures, "People
getting saved and offerings. Both are heart issues. Attendance will
fluctuate like the wind but should be heading in a positive direction
over the long haul. People carrying Bibles are good, too. Although I
would rather our people be carried by the Bible."
- Les DeFelice, president of DeFeliceCare says, "I set the tempo by conveying a sense of urgency and friendliness among my co-workers. When you realize that your actions are being closely watched, the next step is to develop consistency; just like Ray."
Are
you A-OK?
The aforementioned examples of Key Performance Indicators come from a
diverse group of organizations . large and small; manufacturing, service
and government; for-profit and not-for-profit. Even though the organizations
differ, their leaders share something in common. To achieve objectives,
they use one or more KPI's to guide and monitor the organizations they
lead. I call that an A-OK System.
An A-OK System uses the results of "A"ctivities to achieve an
"O"bjective with the tempo monitored by "K"ey Performance
Indicators.
For an organization to achieve its "O"bjective, it needs a "K"PI that encourages people to perform "A"ctivities in a manner that achieves the objective. If either "A", "O" or "K" are missing, the likelihood of success is greatly diminished.
- Activity performance is hit or miss if an Objective lacks a KPI;
- Activities and KPI's with no Objective result in fiscal failure; and,
- Objectives will be haphazardly hit or missed when Activities lack a KPI.
If the KPI is at the bottom of the pyramid (as shown above), most of the activity cost will have been spent before a performance measure signals success or failure. Using Activity Based Management to identify an early intervention KPI (the line across the middle of the pyramid below), will provide management an indication whether a process is in control before the majority of activity costs are spent.
One of my favorite Ray Charles' songs is Georgia On My Mind. When I asked several leaders what's on their mind, Steve Stifler said it's daily bookings. Bob Doig said it's a bell. And for Barry Cameron it's Bibles. If I asked someone what they watch to determine if everything is okay with you or your organization, what would be their response? If they don't know, then you may not be A-OK!
[1] "Rhythm and Sole", John Bryant, Dallas Morning News, October 24, 2004
Do you need to identify the "KPI" for in your business? If so, give ICMS a call 817-475-2945 or e-mail tompryor@icms.net for more information on Activity Based Management.
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