What Are Key Performance Indicators (KPIs)?

Answering, "What are key performance indicators?" is not as easy as first glance. This is because key performance indicators (KPIs) have multiple uses in aviation SMS programs.

KPIs are data metrics (i.e. “Indicators”) used to track performance in companies. Performance in aviation SMS programs is not just “safety.” The other types of performance that relate to SMS programs are:

  • Quality performance;
  • Operational performance; and
  • Financial performance

The important element to keep in mind about KPIs is that they are “key” data metrics. KPIs should only track the most important safety data. To distinguish the "key" performance indicators from regular performance indicators, safety management needs to hone:Core company goals and objectives.

Key performance indicators are “key” in the sense that they created in response to company objectives. KPIs are used for goals and objectives assessment.

What are key performance indicators (KPIs)

How Are KPIs Used in Aviation SMS Programs?

The reason that so many businesses are so concerned about KPIs is that they are essential for assessing operational performance. Key performance indicators are like

KPIs are used in aviation SMS programs to:

  • Monitor continuous improvement;
  • Ensure that goals and objectives are being met;
  • Assess safety performance;
  • Understand failures of the SMS program; and
  • Monitor non-safety elements of operations that are critical for the SMS (ROI, quality management, etc.).

As you can see, KPIs are an SMS programs immune system. They help ensure that safety isn’t compromised.

How Do You Create Key Performance Indicators?

Safety managers create airline or airport key performance indicators by first carefully considering core company goals and objectives. Key performance indicators should be based on these objectives, and help determine management if the goals are being met.

Key performances indicators are generally created to meet company goals and objectives that relate to:

  • Quality management;
  • Safety management; and
  • Financial objectives.

After creating the primary company goals and objectives:

  • Create a list of metrics that closely relate to those goals; and
  • Eliminate all metrics except only the most informative ones.

Aviation SMS software tools greatly assist in creating KPIs.

Best Practices for KPIs

Best practices for KPIs are generally learned over time, and are specific to your company. That being said, there are some proven best practices for KPIs that you can glean from the aviation industry as a whole.

Some of the best KPI practices are:

  • KPIs should change over time. KPIs are not permanent, they lose value as company objectives.
  • Keep refining your KPIs. KPI list is always a work in progress;
  • Review KPIs after any updates to company goals and objectives;
  • Make sure KPIs address short term goals, medium-long term goals, and long term goals;
  • Make sure you have KPIs for front line employees, mid-management, and upper management objectives; and
  • Monitor constantly, such as by keeping KPI metrics on a dashboard so that you can check them on a daily basis.

In order to work with these best practices for KPIs, consider creating a KPI calendar to plan out all KPI related activities:

  • Goals and objectives review;
  • KPI review; and
  • KPI metric brainstorming.