How KRIs should be used?

KRIs must be linked to the company’s strategic priorities, so it all starts with strategy. Each KRI should ideally be linked to a KPI and, in turn, be linked to core strategic goals, priorities, and initiatives. This helps to keep the focus on key risks and not every possible risk that the organization might face.

KRIs should be specific, predictive, and easy to quantify through hard numbers, percentages, or ratios. In addition, for each KRI, you’ll need to identify the relevant thresholds and trigger points – as in, when should your early warning system go off?

Once you’ve got your KRIs and KPIs in place, you need to monitor and track them regularly. How often will depend on the specific KPI and KRI? Some indicators may need to be monitored in real-time, for instance, while others warrant only a quarterly check-in.

It’s also a good idea to review KPIs and KRIs regularly in terms of their relevance to the business. After all, goals and priorities change as a business evolves and this will impact the risk management and performance management metrics that you choose.

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