Find the right KPIs with the market driven approach

The market-driven approach to find the right KPIs

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Passionned Group is a leading analyst and consultancy firm specialized in Business Analytics and Business Intelligence. Our passionate advisors assist many organizations in selecting the best Business Analytics Software and applications. Every two years we organize the election of the smartest company.

Analytical applications

In the Business Intelligence market various industry specific systems – so called analytical applications- are available. These systems help organizations to complete a first draft of information needs relatively quickly and then, possibly, to produce a first version of a Business Intelligence system.

Two step approach

The market-driven approach consists of two steps:

  • Market research and tool selection: analytical applications that are available in the market are being reviewed based on a number of (technical) selection criteria. The main criterion regarding the mapping of information needs is to see whether both the application and its indicators sufficiently match the organization’s business operations and critical processes.
  • Choosing and modifying: once an organization decides on which industry specific application to use, the indicators often need modification as they should be tailored to organization-specific needs.

It can be costly

The market-driven approach can be costly but only when the application does not fit with business operations properly, or when it proves to be rather difficult to modify the key performance indicators – and the required data connections to the proprietary source systems. If this is the case, the organization will probably need to identify its information needs in other ways to then implement this in customized Business Intelligence solutions.

Too fixated on functionality

Another risk is that the organization becomes too fixated on the functionality the application offers and consequently rather blindly trusts the KPIs without giving thought to how they should be used and implemented in the business processes.

Information needs to be used

Ultimately, information needs to be used in some way. It is therefore sensible not to use analytical applications blindly without modifying them first, especially since competitors may be focusing on similar indicators already. It is thus important for an organization to differentiate itself from its competitors by ensuring that the application is completely in line with both the strategy and the key processes.

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