A key figure represents a measured value or status that is compared with other key figures or used for analyses, for example to monitor performance or identify optimization potential. In the field of Process Mining, frequently used key figures include cycle time and number as well as process costs.
What kind of key figures are there?
Depending on the scope of the analysis, different key figures are common and are measured. Companies and employees can also define their own key figures if they want to look at a specific operation.
A basic distinction is made between absolute and relative key figures. Absolute key figures are independent and are not related to any other values. Such key figures are either taken directly from existing data or calculated. The three types of absolute key figures are the individual key figure, the total key figure, and the difference key figure. An example of an individual key figure is the number of employees. The balance sheet total, on the other hand, is a total key figure. Profit is a difference key figure because it is the difference between sales and costs. However, the average processing time of a support request is also an absolute key figure.
Relative key figures, on the other hand, are set in relation to or derived from other key figures. For this reason, they are also called relational key figures. Relative key figures can also be divided into three types. These are relationship key figures, index key figures and classification key figures. The relationship key figures relate two absolute key figures to each other: for example, sales per department. With index key figures, two key figures are related to each other, one of which forms the basis. Index key figures are often used to illustrate a development over time. As a result, one key figure is taken as the starting point (usually index 100) and compared with one or more key figures. For example, sales of products and services via online sales channels were 100% in 2017 and 150% in 2018. In the classification key figure, we compare part of the key figure with the total key figure. An example of a classification key figure is the proportion of screws in the total production materials stored.
A structure of related, complementary, and supporting key figures is called a key figure system.
Where can key figures be measured and used?
In principle, key figures can be defined, measured and used everywhere. These can be common indicators, such as return on investment (ROI), or self-defined indicators. Different key figures are often measured in different areas of a company. For example, there are different key figures in marketing than in production. Common performance indicators in marketing include the conversion rate, i.e. how many visitors become actual contacts and leads. In contrast, this figure is irrelevant for production. Here the maintenance costs or the production volume are measured. It should therefore be clearly defined which key figures are meaningful and value-adding in which areas. Otherwise, high costs may flow into the measurement and evaluation of key figures, which do not bring any added value or knowledge.
However, there are also key figures that are largely independent of the topic. These indicators relate to the performance of processes, employees or systems and machines, among other things. Performance is an important indicator of the efficiency and success of a company, department, etc. and is therefore frequently measured.
Key figures can be used to carry out evaluations. Depending on the key figure and analysis, optimization potentials such as bottlenecks or process problems can be derived or uncovered. Furthermore, it can be checked whether it is possible to comply with specifications or schedules or whether, for example, more employees or machines are needed. Accordingly, key figures are one of the most important orientation and testing factors in controlling.