How can you set and review process performance targets?

1 Define your process

Before you can set any targets, you need to clearly define your process and its scope, inputs, outputs, activities, roles, and resources. You also need to identify the customers and stakeholders of your process and their expectations and requirements. This will help you determine what aspects of your process are critical and relevant to measure.

2 Choose your metrics

When selecting metrics to measure the performance of your process, you should ensure they are SMART: specific, measurable, achievable, relevant, and time-bound. Efficiency metrics measure how well your process uses its resources, such as time, cost, labor, or materials. Examples include cycle time, throughput, productivity, or utilization. Effectiveness metrics measure how well your process meets its objectives - for example defect rate, error rate, customer satisfaction or compliance rate. Impact metrics measure how well your process contributes to the strategic goals of your organization - such as revenue, profit, market share or customer retention - with examples being return on investment, customer lifetime value, net promoter score or retention rate.

3 Set your targets

Once you have chosen your metrics, you need to set your targets for each one. These should be realistic, challenging, and aligned with your process objectives and organizational goals. You can use different methods to set targets, such as benchmarking, gap analysis, or customer feedback. Benchmarking involves comparing your process performance with the best practices or standards in your industry or sector. Gap analysis identifies the gap between your current process performance and your desired process performance. Customer feedback collects and analyzes feedback from your process customers and stakeholders to set targets that meet or exceed their expectations.