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How to Define Value Drivers – a Simple Technique for Business Strategy and Performance Measurement

By Andy Burrows

[First published July 2018; updated July 2021]

In this article I want to introduce you to a very simple tool called the “value driver tree”.

Why you need a value driver tree

Getting business strategy right is not easy.

The definition of strategy is simple enough: “a plan of action to achieve an aspiration or overcome a problem”. And the process of arriving at the plan sounds so easy: define the objective (vision, aspiration, problem), assess the current state and therefore the gaps, and decide how to get from where you are to where you want to go.

One of the things that makes it difficult is knowing where to start in assessing the current state. There are so many factors you could take into account. It’s sometimes difficult to see the wood for the trees.

And performance measurement has similar issues. I’ve written previously about the need to make sure you’re looking at the right performance measures – KPIs –...

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How to Develop KPIs That More Than Count

By Andy Burrows

[First published 7th September 2017]

This article looks at how to go about developing Key Performance Indicators (KPIs).

If you’re interested in this topic enough to start reading, you’ll know that KPIs give you a richer view of performance than the normal accounting stuff that we produce in Finance. You’re also probably painfully aware that there are so many metrics to choose from. And that can make you wonder whether you’re looking at the right things.

So, the common question is, how can we develop the right KPIs?

But, before we get to that, I want to do through three things:

  1. Give a simple definition of a KPI
  2. Clear up a couple of misconceptions
  3. Take a stab at a description of what a good KPI is

That should head us in the right direction…

What are KPIs?

A simple definition of a Key Performance Indicator is that it’s just a specific way of seeing how well things are going with something. That sounds quite general, but I’ve...

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Are Your Monthly Reports Leading The Business Astray?

By Andy Burrows

[First published 29th March 2018]

I remember hearing the old sayings about performance measurement early on in my career, and thinking they were pretty astute – catchy and encapsulating a profound truth. Things like:

“If you don’t measure it, you don’t manage it!”

“What gets measured gets done!”

And I’ve always taken them to mean something positive – if you really value your objective, then measure your progress towards it. If you’re not measuring it, it shows you don’t really care. So, if you really do care, and you want it to get done, then measure it, report it, etc.

But recently that last one – “what gets measured gets done” – has been making me think. There’s a negative side to it as well.

The way you drive

The truth of that saying – “what gets measured gets done” – struck me when I drove my son’s Merc once.

The dashboard has a mode to...

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