Key performance indicators (KPIs) are measures of performance that help an organization better understand the progress it's making to achieve certain goals.
KPIs can be used to:
Monitor the state of the business
Help define a course of action
Identify trends (whether beneficial or harmful)
Provide early warnings of systemic issues that can prompt corrective action before incidents take place
Provide reinforcement on the actions that have been taken to improve overall performance
Provide feedback on whether changes are helping, and
Provide improved visibility on efforts being made to improve performance.
From a safety perspective, KPIs can be used to help a company focus on areas of the business that have the potential to cause accidents or harm.
In choosing which KPIs are most useful for your company, bear in mind that the best KPIs are easy to measure, objective, relevant, cost efficient, beneficial, and meaningful. Most importantly, they must be able to provide decision-makers with the type of information they need in order to guide decision-making and either achieve desired results, or avoid undesirable outcomes.
KPIs and trend analysis are part of the continuous improvement cycle of a company, and each company should choose a set of KPIs that are relevant to the standards and outcomes that are desired. Early stage companies usually begin with the legislation or regulatory framework that is relevant to their industry, and will likely choose actions that meet this basic level of performance. This would include, at a minimum, activities required to meet the minimum safety requirements for that industry.
Later stage companies base their actions on KPIs included within their business plans and management or corporate systems. Examples of KPIs for later stage companies with more complex safety policies include percentage of jobs that include high risk tasks and hazard assessments, and percentage of equipment tests that must meet a certain performance criteria.
Leading and Lagging Indicators
An indicator is anything that can be used to predict future trends. A leading indicator provides information about the current situation that may affect future performance – allowing one to take action that will influence future events, or outcomes.Lagging indicators follow an event, and generally allow one to confirm patterns and characterize historical performance.
By using a dashboard of information from leading indicators, you're able to monitor the effectiveness of a health and safety program and obtain advance warnings of system weaknesses before a tragedy occurs.This information allows the you to respond to changes in circumstances and take actions to either achieve desired outcomes, or avoid unwanted outcomes.
Lagging indicators monitor the outputs from the health and safety system, and can be used as the basis from which to take corrective action.If the total number of incidents exceeds a specific performance standard or safety requirement, then this can form the basis to implement changes to your system to ensure the standard or requirement is met.
