98 “Better” KPIs
–
The Key to Stakeholder Integration with
Conscious Capitalism
If you struggle with the Functional Accountability Chart (FACe) and Process
Accountability Chart (PACe) tools in Scaling Up, you are not alone. Leaders often can’t
find just the right corresponding key performance indicators (KPI).
These KPIs must measure specific actions that lead to results, focusing on functions
and processes, all aiming for the goal of better, faster, and cheaper.
KPIs for “faster” are measured by time, Days to Deliver, or People Hours to Produce. It’s
straightforward and quantifiable.
KPIs for “cheaper” are measured by cost, cost of Raw Materials, Production, Labor, etc.
This too is straightforward and can be quantifiable with precise financial data analysis.
Unlike faster and cheaper, KPIs for “better” are harder to capture. Better is qualitative
and more challenging to quantify in numerical terms.
Here is the list of stakeholders as laid out in Conscious Capitalism’s Stakeholder
Integration as well as some KPIs that may help you make their experience
“Better”.
Key Performance Indicators are sorted into 2
categories. Leading indicators are forward-
looking and help in identifying areas for
improvement before problems arise, while
lagging indicators are retrospective,
reflecting the outcomes of past efforts and
policies.
(Please note that these categories are
indicative, and the classification of certain
KPIs as leading or lagging indicators may vary
depending on the specific context and business
practices.)
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“Better” KPIs for Employees:
Being better for employees means not only fulfilling their basic needs but also supporting
the intrinsic motivation of humans to achieve excellence and live purposeful lives.
LEADING INDICATORS:
1. New skills learned per employee: Measures the rate of skill acquisition by employees,
indicating their adaptability and commitment to personal growth.
2. Average number of hours invested in employee training and talent development:
Reflects proactive investment in skill development and knowledge enhancement.
3. Mentoring and coaching participation: Indicates the willingness of employees to
engage in self-improvement, which may lead to increased performance.
4. Employee well-being program participation: Reflects proactive steps taken to
promote employee health and well-being, which can result in improved productivity
and satisfaction.
5. Diversity and inclusion index: Measures the level of diversity and inclusion within
the workforce, potentially driving innovation and team performance.
6. Employee innovation suggestions implemented: Demonstrates a culture of
innovation and continuous improvement, which can boost overall company
performance.
7. Employee participation rate in meetings: Measures employee engagement and
active involvement in team collaboration, which may enhance productivity and
creativity.
LAGGING INDICATORS:
1. Career development progress: Shows how far employees have progressed in their
career development, indicating the effectiveness of developmental programs.
2. Stress level monitoring (to prevent burnout and turnover): Reflects the long-term
impact of stress management programs and their influence on retention.
3. Safety incident rates: Indicates the historical data on safety incidents, revealing
areas for improvement in employee well-being.
4. Employee retention rate: Reflects the effectiveness of retention strategies and
overall job satisfaction.
5. Employee recognition awards: Shows the impact of recognition programs on
morale and productivity.
6. Employee surveys on work-life balance: Captures feedback on the historical work-
life balance, helping to fine-tune related initiatives.
7. Employee community engagement initiatives: Measures the historical participation
rate in community engagement activities, showcasing the company’s commitment
to social responsibility.
8. Employee engagement scores: Represent the retrospective measurement of
employee engagement and satisfaction.
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“Better” KPIs for Customers:
Being better for customers means supporting their health and lifestyle choices while
offering creative products and/or reliable services that competitors have not yet
thought of or cannot easily duplicate.
LEADING INDICATORS:
1. Repeat purchase frequency: Measures how often customers make repeat purchases,
indicating their loyalty and satisfaction.
2. Referral frequency: Reflects how frequently customers refer others to your products
or services, indicating their belief in your value proposition.
3. Product or service customization options: Demonstrates customers’ willingness to
personalize their experience, reflecting their engagement and satisfaction.
4. Delivery and response times: Indicates the efficiency and responsiveness of
customer service, influencing overall satisfaction.
5. Product or service adoption rate: Measures how quickly customers adopt and start
using your products or services, suggesting their immediate engagement.
6. Sales pipeline velocity / close rate: Shows the speed at which potential customers
move through the sales process, predicting future revenues and market demand.
7. Personalization levels in customer interactions: Reflects the depth of personalized
experiences provided to customers, indicating tailored services and enhanced
satisfaction.
LAGGING INDICATORS:
1. Customer satisfaction scores: Represents historical satisfaction ratings, which may
influence future purchasing decisions.
2. Average order value: Reflects the average amount customers spend on a single
order, affecting revenue and profitability.
3. Net Promoter Score (NPS): Indicates customer loyalty and the likelihood of them
recommending your business to others.
4. Customer lifetime value: Reflects the historical total value of a customer over their
engagement with your business.
5. Percentage of repeat customers: Demonstrates the historical rate of customers
returning for additional purchases, reflecting long-term loyalty.
6. Product return rates: Measures the historical rate of product returns, influencing
quality and satisfaction levels.
7. Product or service adoption rate: Reflects the historical data on how quickly
customers have adopted your offerings, predicting trends and user engagement.
8. Customer feedback and suggestion implementations: Demonstrates the historical
effectiveness of feedback and suggestion programs in improving the customer
experience.
9. Community engagement events for customers: Shows the historical engagement
of customers in community-related events, reflecting brand loyalty and involvement.
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“Better” KPIs for Investors:
Being better for investors means exercising a commitment to long-term sustainable
growth, rather than short-term gains. (For the companies without investors, the
company itself and its leadership team members are the investors.)
LEADING INDICATORS:
1. ESG (Environmental, Social, Governance) investment rating: Demonstrates the
company’s commitment to responsible and sustainable business practices, which
can attract socially responsible investors and influence stock price stability.
2. Number of socially responsible investors: Indicates the company’s ability to attract
investors who prioritize ethical and sustainable investments, potentially affecting
the percentage growth in the company’s valuation.
3. Investor engagement and feedback: Reflects active communication and
collaboration with investors, which can positively impact transparency in financial
reporting and lead to more positive media mentions.
4. Alignment with Sustainable Development Goals (SDGs): Shows the company’s
dedication to making a positive societal impact, which can influence investor
engagement and interest in the company’s long-term growth.
5. Quarterly investor communications: Demonstrates proactive engagement with
investors, fostering transparency and trust that can positively affect stock price
stability and financial performance benchmarks against competitors.
LAGGING INDICATORS:
1. Stock price stability: Reflects historical stock performance, indicating the stability
and confidence in the company, driven by factors like investor engagement and
alignment with SDGs.
2. Earnings per share growth: Represents past financial performance and growth,
influenced by investor decisions, such as dividend yield and growth.
3. Return on investment (ROI): Measures the historical returns on investments, which
can impact investor engagement and feedback.
4. Percentage growth on the company’s valuation: A historical metric indicating how
the company’s value has evolved, influenced by factors like stock price stability.
5. Dividend yield and growth: Reflects past dividend payments and growth rates,
affecting the number of socially responsible investors and alignment with SDGs.
6. Transparency in financial reporting: A lagging indicator that indicates historical
transparency practices, influenced by positive media mentions.
7. Positive media mentions: Historical metrics reflecting media sentiment and its
effect on transparency and investor engagement.
8. Financial performance benchmarks against competitors: Reflects historical financial
performance relative to competitors, influenced by transparency, alignment with
SDGs, and investor engagement.
9. Operating Cash Flow Ratio: Measures historical cash flow efficiency, influencing
ROI and investor engagement.
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10. Gross Burn Rate: Reflects historical expenditure rates, affecting financial performance
benchmarks and ROI.
11. Cash Conversion Cycle: Historical indicator showing efficiency in working capital
management, impacting ROI and financial performance benchmarks.
12. Sales Growth Rate: Reflects historical sales growth, influencing stock price stability.
13. Fixed Asset Turnover Ratio: Represents historical asset management efficiency,
impacting ROI and financial performance benchmarks.
14. Budget Creation Cycle Time: Historical metric reflecting budgeting efficiency,
affecting investor engagement and alignment with SDGs.
15. Number of Budget Iterations: Historical indicator showing efficiency in budgeting
processes, influencing transparency and investor engagement.
“Better” KPIs for Suppliers / Vendors:
Being better for suppliers and vendors means becoming your suppliers’ favorite
customers and working with them in a relationship-oriented manner, rather than a
transactional one.
LEADING INDICATORS:
1. Commitment to fair trade practices: Demonstrates a proactive approach to ethical
and sustainable business relationships, fostering positive supplier and vendor
satisfaction and on-time payment performance.
2. Collaboration on sustainability initiatives: Indicates a focus on joint efforts to
improve sustainability practices, which can strengthen supplier relationships over
time.
3. Joint product development projects: Reflects ongoing collaborative innovation
efforts that can lead to successful joint marketing and innovation outcomes.
4. Payment terms negotiation success: Demonstrates effective negotiation practices
that may lead to fairer terms and fewer service exceptions and complaints.
5. Vendor support in times of crisis: Indicates a supportive and collaborative approach
during challenging times, fostering stronger relationships and alignment with shared
values.
6. Joint social responsibility initiatives: Reflects shared efforts to make a positive
societal impact, which can contribute to supplier and vendor satisfaction.
7. Contracts aligned with shared values: Demonstrates a commitment to shared ethical
values in business agreements, leading to better supplier and vendor satisfaction.
LAGGING INDICATORS:
1. Accounts payable days: Reflects historical efficiency in settling accounts, influenced
by on-time payment performance and joint social responsibility initiatives.
2. Supplier and vendor satisfaction ratings: Historical measures of satisfaction based
on collaboration and shared values, affected by a commitment to fair trade practices.
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3. On-time payment performance: Historical indicator showing the efficiency of
payments, influenced by payment terms negotiation success, and joint social
responsibility initiatives.
4. Number of referrals to other clients: Reflects past positive experiences and
successful collaborations, influenced by supplier relationships and joint marketing
efforts.
5. Number of service exceptions and complaints: Represents historical performance
and any issues faced, influenced by payment terms negotiation success, and
collaborative innovation success.
6. Collaborative innovation success: Demonstrates the historical success of innovation
projects, impacted by joint product development and collaboration on sustainability
initiatives.
7. Personalization levels in supplier’s interactions: Reflects historical efforts to tailor
interactions, influenced by collaborative innovation and product development
projects.
8. Average Invoice Processing Cost: Historical metric indicating invoice processing
efficiency, influenced by collaborative innovation and payment terms negotiation
success.
“Better” KPIs for Local Community and Environment:
Being better for local communities and the environment involves providing meaningful
and well-paid jobs, reducing waste, and engaging in local philanthropic activities.
LEADING INDICATORS:
1. Number of jobs created in the local community: Represents the proactive effort to
support the local community by providing job opportunities.
2. Local workforce diversity and inclusion: Demonstrates the ongoing commitment
to building a diverse and inclusive workforce, leading to local workforce diversity
and inclusion.
3. Volunteering hours by company employees in the community: Reflects the ongoing
commitment to community engagement, with potential long-term positive impacts
on community well-being and education.
4. Community development projects initiated: Indicates the proactive approach
to community development, which can lead to improved local education and
community well-being over time.
5. Local charity partnerships: Reflects the ongoing collaboration with local charities
and a commitment to making a positive impact on local education and well-being.
6. Environmental education and awareness programs: Demonstrates an ongoing
effort to raise environmental awareness in the local community, potentially reducing
waste and greenhouse gas emissions in the long run.
7. Local infrastructure investments: Reflects the proactive investment in local
infrastructure, leading to community development and improved local education.
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8. Environmental restoration projects: Demonstrates ongoing initiatives to restore
the environment, potentially leading to the reduction of environmental waste and
greenhouse gas emissions.
LAGGING INDICATORS:
1. Average wage compared to local standards: Represents a historical measure of
wage levels, influenced by the number of jobs created in the local community.
2. Local philanthropic donations: Historical indicator reflecting past philanthropic
efforts, which contribute to local charity partnerships and community development.
3. Reduction in environmental waste: Represents a historical reduction in waste,
potentially driven by ongoing environmental restoration projects and sustainable
supply chain practices.
4. Greenhouse gas emissions reductions: Historical measures of emissions reductions
influenced by sustainable supply chain practices and percentage of renewable
energy usage.
5. Percentage of renewable energy usage: Historical metric indicating the adoption
of renewable energy, potentially leading to greenhouse gas emissions reductions
and reduced waste.
6. Local environmental awards and recognitions: Historical recognition of
environmental efforts, influenced by sustainability practices and environmental
education programs.
7. Positive impact on local education: Represents the historical impact on local
education, influenced by community development projects and volunteering hours
by company employees.
8. Number of locally sourced materials: Historical measures of sourcing locally,
potentially affected by sustainable supply chain practices and a reduction in
environmental waste.
“Better” KPIs for Outer Circle Stakeholders:
Being better for the outer circle means viewing competitors not as enemies to be crushed
but as teachers to learn from, forging working relationships with local government and
civil society, and most importantly, avoiding corrupt activities at all costs.
LEADING INDICATORS:
1. Number of industry collaboration initiatives: Indicates proactive engagement in
collaborative projects and partnerships within the industry to foster growth and
innovation.
2. Participation in industry knowledge-sharing events: Demonstrates a commitment
to sharing industry knowledge and learning from peers, fostering a culture of
continuous improvement.
3. Engagement with competitors in joint research and development: Reflects ongoing
collaboration with competitors in research and development efforts, focusing on
industry-wide advancements.
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4. Contributions to disaster relief efforts: Demonstrates proactive engagement with
global humanitarian issues and reflects ongoing efforts to mitigate the impact of
disasters.
5. Number of global diplomatic and trade partnerships: Reflects the proactive
development of international partnerships, which may lead to positive global
diplomatic and trade relations in the long term.
6. Participation in global sustainability initiatives: Demonstrates proactive
involvement in sustainability efforts on a global scale, potentially contributing to a
positive global reputation.
7. Contributions to international disease control efforts: Indicates active engagement
in addressing global health issues and preventing the spread of diseases.
8. Advocacy for human rights worldwide: Reflects ongoing commitment to human
rights advocacy on a global scale, leading to a positive reputation.
LAGGING INDICATORS:
1. Positive industry reputation and recognition: Historical indicator reflecting the
reputation and recognition earned within the industry, influenced by collaborative
efforts and shared learning.
2. Industry-wide innovation adoption rate: Measures the historical rate at which
industry-wide innovations are adopted, influenced by collaborative research and
development.
3. Positive global media mentions and reputation: Historical indicator reflecting past
media mentions and reputation, influenced by various global initiatives.
4. Participation to reduce global income inequality: Represents a historical
commitment to addressing global income inequality, potentially affecting global
diplomacy and reputation.
5. Support for refugees and displaced populations: Historical indicator demonstrating
past efforts to support refugees and displaced populations, potentially contributing
to a positive global reputation.
6. Investments in global education initiatives: Historical measure of investments in
global education, contributing to a positive global reputation.
7. Support for global environmental preservation: Historical indicator reflecting past
efforts in global environmental preservation, influencing global reputation and
engagement.
8. Number of pieces of legislation enacted: Reflects historical legislative efforts related
to global geopolitical issues, contributing to global diplomacy and reputation.
To summarize, when it comes to the question “Better for whom?,” Conscious Capitalism
places that answer at the center of stakeholder orientation, making it the core of any
business.
PRO TIP FOR SUCCESS:
Share and review this with your leadership team. Together, pick 3-5 that align
with your business strategy, One-Page-Strategic-Plan, and FACe and PACe
tools. Share this with your entire organization and encourage employees to
participate in choosing the KPIs that they want to take part in.
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Want a deeper dive into Stakeholder Integration
and learn how to foster Stakeholder Relationships
to scale your impact and reduce drama? Consider
enrolling in the Master Business Course Conscious
Capitalism with Raj Sisodia.
Your leadership is needed.
This course is highly recommended for heads
of organizations, CEOs, board members,
chairpersons of the board, and industry leaders
who are dedicated to a transformed world.
If you would like to learn more about building
a caring culture with robust learning and talent
development systems, our team members at
Growth Institute would love to help.
time to talk!
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