I’ve seen a lot of business statistic graphs over the years and many of them are useless for communicating trends. Key Performance Indicators (KPIs) should be ubiquitous and understandable to everyone in a business.
Rules to follow
- Absolute numbers (e.g. page views per day, widgets sold per day) tell us how a business is doing.
- Ratios of X/unit tell us how systems are doing.
- Ratios of Units/Profit tell us how much they cost and bridge the gap between Biz metrics and Tech metrics.
- Simple KPIs with concrete units are easy understand. KPIs without well-understood units require too much explanation.
- KPI plots must have the actual units specified in the legends.
- KPI plots with the same numerator should be in the same graphic.
- Plot Y axies should be appropriately scaled and must have a 0-origin.
- The collection of the KPI data does not need to be exact, it must only be agreed upon.
- KPIs must be versioned; if a KPI collection method is changed, the KPI must have a new version.
Assume we are selling Widgets, for each Application and collectively for all Applications, sampled for each day:
- W = number of new widgets sold
- P = total money in-flow – out-flow (gross profit)
- WP = projected new widgets gross profit (estimated)
Applications (internal and externally facing)
- P = page views
- PE = page errors
- PEP = PE / P = errors / pages
- PT = total page time
- PTP = PT / P = page time / pages
- PW = P / W = pages / new widget sold
- PTW = PT / W = page time / new widgets sold
- PTWP = PT / WP = page time / new widgets sold gross profit
Offline Processing – Batches
- B = batch items
- BE = batch item errors
- BEB = BE / B = errors / items
- BT = total batch item time
- BTB = BT / B = item time / item
- BTP = BT / P = item time / gross profit