Foundations

Ann Rodriguez and Viney Chadha

In this chapter, we will lay the groundwork for several important terms and concepts that will be used throughout the book. The chapter will also describe some broad challenges in implementing and using a KRI framework and programme, challenges that play a central role in the existing state of maturity of KRIs in financial services and other industries.

EVERYBODY MEASURES SOMETHING

“If someone separated the art of counting and measuring and weighing from all the other arts, what was left of each (of the others) would be, so to speak, insignificant.” Plato

Most organisations measure some combination of metrics that provide insight into performance, control and risk. These insights often fall under the heading of “profile” or “view”. We will use the terms profile, view, event and risk somewhat interchangeably to refer to the non-specific object that a metric is measuring. Arguably, all of these metrics inform about potential risk to the achievement of enterprise objectives, either directly or indirectly!

Businesses measure things to try to answer these four questions:

1. are we on track to meet our business objectives?
2. is our risk within appetite?
3. is there anything on