Unlocking KRIs

Ariane Chapelle

You can count on one hand the number of organisations fully satisfied with their KRIs. Beyond their core business, many organisations struggle to have a clear view of what constitutes an efficient KRI suite.

A classification of KRIs based on four categories – exposure, stress, causal and failure – would bring a wealth of benefits: insisting on the necessity of preventative KRIS, addressing the causes of risks rather than events, helping to track changes in the environment, increasing resource stretch before the business is damaged (rather than reporting lagging trends) and highlighting the links between performance, control and risk indicators.

ADDRESSING EXPOSURE

Exposure indicators relate to the nature of the business environment and to its critical dependencies. The business environment may be volatile or stable, growing or mature, regulated or free. Critical dependencies include main suppliers and vendors, large clients, essential systems or key staff. Accepting a given business environment and critical dependencies are risk appetite decisions. Next, monitoring any changes to this accepted level of risk is part of a comprehensive KRI programme.

Crucially, exposure