Background - marine company in the process of creating an integrated system of ISM Code/ISO 9001/ISO 14001/OHSAS 18001. Certification is not being sought at this time.
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Good morning - I am in the process of reviewing requirements for setting objectives and targets. Can someone please explain the differences between KPIs and objectives/targets. I want to keep things simple with both terminology and process! (when creating the procedure(s).

:thanks:

Background - marine company in the process of creating an integrated system of ISM Code/ISO 9001/ISO 14001/OHSAS 18001. Certification is not being sought at this time.
___________________________________________________

Good morning - I am in the process of reviewing requirements for setting objectives and targets. Can someone please explain the differences between KPIs and objectives/targets. I want to keep things simple with both terminology and process! (when creating the procedure(s).

:thanks:

Simple sports example:

Objective/Target: Want to win the game.
KPI: Score

Stijloor.

Background - marine company in the process of creating an integrated system of ISM Code/ISO 9001/ISO 14001/OHSAS 18001. Certification is not being sought at this time.
___________________________________________________

Good morning - I am in the process of reviewing requirements for setting objectives and targets. Can someone please explain the differences between KPIs and objectives/targets. I want to keep things simple with both terminology and process! (when creating the procedure(s).

:thanks:

Objectives/Targets = what you want or where you want to go
KPI (Key performance index) = tells you if you are going or getting to where you want to go (objetive/target).

Look up the definitions for objectives and targets in Section 3 of ISO 14001 and Objectives in OHSAS 18001 Section 3 and then match those definitions to what ISO 9000:2005 has for objectives and you see that essentially they are the same. I could go into a 1 hour lecture here but I'm lectured out for the month (only did about 80 hours)

Pay particular attention to the Notes at the end of the definitions and the linkages/referenced shown in them for other words

If you want to keep it simple call them what you want but defer to the most stringent requirment between the standards if you are truly integrating...ergo, all objectives, regardless of type, must be measurable.

KPI (Key performance index)aka Key Performance Indicator(s).

aka Key Performance Indicator(s).

:thanx:

woops... sorry about that... slip of the fingers on the keyboard... :bonk:

I am in the process of reviewing requirements for setting objectives and targets. Can someone please explain the differences between KPIs and objectives/targets. I want to keep things simple with both terminology and process! (when creating the procedure(s).


The term 'target' can be confusing as it's sometimes used with different meanings. It may crop up on 'either side' of the equation, to mean either:


the objective itself (something you want to reach - presumably as in 'hit the target), or
the metric for the objective (something set & used to assess if the objective has been reached, a KPI, or a specific value such as >85%)



BTW, you get my award for useful post in terms of giving a background/ context to your question, which is very helpful Way to go! :applause:

KPIs are misunderstood in most implementations of ISO that I have seen. But the best way to see them is as unseen ingredients that give you the result you are looking for.

For example, a typical ISO implementation might set an objective of clearing all NCs within 2 weeks of audit, with a KPI of 2 weeks. This is called a lagging indicator and it does not influence the time taken by the subject to clear the NC.

It is far better to use what are called "leading indicators" as they influence the outcome.

So we could set the same target with a KPI of running 2 ISO awareness courses per year. So the logic is that the extra training reduces the level of NC and speeds up the time taken to clear them. In this case the KPIs are called leading, because they are designed to influence the outcome.

So we see that using leading KPIs is far more effective.

KPIs are very useful when the right ones are selected but this takes a bit of imagination and it's something I put a lot of thought into. The general rule for a good one is to decide if it's leading or lagging. If lagging it's not much good, so throw it away.

Again, if you have a target of reducing slips and trips on the shop floor from 100 to 50, then a fairly useless lagging KPI would be slips and trips =50. A far better KPI would be floor washed twice each day with ajax non slip.

Hope this helps

<snip>The general rule for a good one is to decide if it's leading or lagging. If lagging it's not much good, so throw it away.

<snip>

:confused:

For clarification: are you suggesting that measuring the number of NCs (a lagging indicator, showing where something has not gone right) over a defined period as an indicator of the degree of conformance to requirements should be "thrown away" (i.e., not measured and reported)?

:confused:

For clarification: are you suggesting that measuring the number of NCs (a lagging indicator, showing where something has not gone right) over a defined period as an indicator of the degree of conformance to requirements should be "thrown away" (i.e., not measured and reported)?


I sure would not recommend thowing that out! It is a primary indicator of whether your customers are disatisfied with your performance. It may be a lagging indicator but is very important.

You should not be asking what you should measure. The better question is to determine what the important criteria of effectiveness are fore each process (cl. 4.1.c). When your management team determines and agrees on those, then the criteria will make it clear what you should measure (cl. 4.1.e).

KPIs are misunderstood in most implementations of ISO that I have seen. But the best way to see them is as unseen ingredients that give you the result you are looking for.

For example, a typical ISO implementation might set an objective of clearing all NCs within 2 weeks of audit, with a KPI of 2 weeks. This is called a lagging indicator and it does not influence the time taken by the subject to clear the NC.

It is far better to use what are called "leading indicators" as they influence the outcome.

So we could set the same target with a KPI of running 2 ISO awareness courses per year. So the logic is that the extra training reduces the level of NC and speeds up the time taken to clear them. In this case the KPIs are called leading, because they are designed to influence the outcome.

So we see that using leading KPIs is far more effective.

KPIs are very useful when the right ones are selected but this takes a bit of imagination and it's something I put a lot of thought into. The general rule for a good one is to decide if it's leading or lagging. If lagging it's not much good, so throw it away.

Again, if you have a target of reducing slips and trips on the shop floor from 100 to 50, then a fairly useless lagging KPI would be slips and trips =50. A far better KPI would be floor washed twice each day with ajax non slip.

Hope this helps

I've been doign this a long time, but this is one of the most confusing explanations I've ever read. I actually agree with your premise that leading indicators are better than lagging ones, but lagging indicators serve a purpose as well. They keep score and tell you whether you are on track to meet your targets.

I also think you are confusing KPI's, which are metrics, with targets or goals for those metrics, such as you described. Also, your explanation misses the step of documenting the items in clause 4.1.c.

Background - marine company in the process of creating an integrated system of ISM Code/ISO 9001/ISO 14001/OHSAS 18001. Certification is not being sought at this time.
___________________________________________________

Good morning - I am in the process of reviewing requirements for setting objectives and targets. Can someone please explain the differences between KPIs and objectives/targets. I want to keep things simple with both terminology and process! (when creating the procedure(s).

:thanks:


KPI's is just a term for Key Process Indicators. They are metrics, data you are measuring. Targets are the goals you set for those metrics.

Scrap is a metric (KPI) we track. Our goal, target, is to reduce it to 0.75%

I measure my weight each week. My goal, target, is to lose 13 more pounds.

I agree, keep it simple. It does no one any good to make it complicated.

If you want some help, let me know.

Targets are goals you set for those metrics.