From this article, you will learn about:
4 different KRI Indicator types: upper limit, lower limit, range and manual
KRI limit types
Periodic scheduling of KRIs
Different KRI indicator types
You can select from 4 different KRI Indicators, depending on how you want to measure the KRI:
Upper Limit,
Lower Limit,
Range, or
Manual.
Upper Limit
Choose ‘Upper Limit’ where low KRI indicator values are better than high values.
For example, you may have created a KRI to measure how many WHS incidents have been reported over a period of time. Using the ‘Upper Limit’ Indicator, you can apply threshold values that Ansarada GRC will use to set the KRI Trend and Rating each time a KRI Measurement is generated.
The screenshot below shows the ‘Upper Limit’ Indicator settings for such a KRI Indicator. Based on the organisation’s policies, the Indicator settings are as follows:
1 The ideal value (the ‘Target’) is zero WHS Incident reports for the month.
2, 3 A warning is to be raised if 1 or more WHS Incidents reported for the month.
4 The organisation will not tolerate any more than 2 WHS Incident reports per month (‘Threshold’ = 3).
5 A summary of the boundaries between ratings.
Lower Limit
Choose ‘Lower Limit’ where high KRI values are better than low values.
The screenshot below shows ‘Lower Limit’ Indicator settings for a KRI that measures a financial figure:
1 The ideal value (the ‘Target’) is 100000 (a typical calendar month).
2, 3 Based on organisational policy, a warning is to be raised if the number drops below 90000.
4 The organisation will not tolerate a figure of less than 80000 (‘Threshold’ = 75000).
5 A summary of the boundaries between ratings.
Range
Choose ‘Range’ where the ideal KRI value is a balance between two undesired extremes.
An example of this may be a financial institution that needs to maintain a certain percent tolerance to meet regulatory requirements, but not be so conservative in lending that the business suffers.
The screenshot below shows ‘Range’ Indicator settings for this example—the amount of percent tolerance that the organisation has at a given point in time.
1 The organisation wants to take immediate action to rectify percent tolerance increases 25% and above. This figure is set as as the ‘Upper Limit’ indicator.
2 If the percent tolerance increases above the target, this indicates that the organisation an impact on company performance. The organisation has set a ‘Warning Top’ value of 23%.
3 The organisation has determined that the ideal value (the ‘Target’) is 21.5%.
4 The organisation wants to know if percent tolerance drops from the Target as this indicates a possible risk to the regulatory requirement. A ‘Warning Lower’ value of 20%.
5 The regulations require that the organisation has at least 18% percent tolerance , so this figure is set as the ‘Lower Limit’ value.
6 A summary of the boundaries between ratings.
Manual
Choose ‘Manual’ where the measurement cannot be readily defined using values. Type a description of what the indicator should be.
This type of Indicator will likely require attachments in support of the Measurement activity. You can make an attachment mandatory for Measurement completion (see the Mandatory Attachment option (10) on the ‘Task’ tab).
Choosing a KRI Limit Type
Choose a KRI Limit Type to suit the Indicator you want to measure.
For ‘Lower Limit’, ‘Upper Limit’ and ‘Range’ Indicators, you can select:
Number,
Currency, or
Percentage.
Note: You can use figures of up to 2 decimal places for each of these Limit Types.
For the ‘Manual’ Indicator, the ‘Text’ Limit Type is your only option.
Periodical Measurement
KRIs are scheduled periodically to record the required measurement, ; such as:
Monthly,
Quarterly (3 months),
Half Yearly (6 months),
Yearly (12 months),
Sesquiennial (18 months),
Two Yearly (24 months),
Three Yearly (36 months),
etc.
The Due Date of these measurements is usually in the following month; e.g. a monthly measurement for period January would have a Due Date in February because January needs to finish to have the final measurement.