High-performing finance departments tend to use key performance indicators, or KPIs, and process improvement to increase performance. After all, you can't manage what you can't measure.
KPIs can be used to set, communicate and monitor specific standards and expectations. And their real value comes from analysing the root causes of any deviations and fixing the process so that you get back on track quickly.
Tread with care, however, to ensure KPIs are not over-used. Think each one through thoroughly because some, although set with good intent, can drive unintended and unwanted behaviours.
A few tips: involve the team when writing the KPIs, set them sensibly and appropriately and make sure they are aligned to departmental objectives. Try to keep them simple and meaningful, and remember their value lies in quickly identifying any deviations and improving the process to get back on track.