Who:	Client Commercial Contract Manager
Why:	Key Performance Indicators (KPIs) are quantifiable measurements that reflect the critical success factors of an organization. They are used to define and measure progress toward organizational goals. Monitoring of KPIs over time provides a measure of provider performance stability.

Before you begin

The Technical Contract Manager has configured KPI Templates to be used on Contracts.  The Commercial Contract Manager has associated each Contract with the relevant KPI Template so the Provider Performance can be compared.

Procedure

1. On the LPG menu select Contracts > Find Contracts.

The List Contracts screen appears.

2. Enter the search criteria as required. (To display all Contracts, don’t enter any criteria.)

3. Click the Search

The list of Contracts matching the search criteria are displayed below the Search button.

NOTE: Contracts that have no Edit link (A) are managed by another workgroup that the user is not a member of, and thus, the Contract cannot be edited by the current user.

Edit Contract link

4. The Edit link opens the Update Contract If you move to the KPI tab on this screen, you can view the KPI settings for the contract you are on.

NOTE:   As the Contract is active and Ratings are being measured, no changes can be made on the KPI tab.  To vary KPI settings, the Contract Manager would associate the contract with a new Ratings template.

a. The KPI Template identifies which set of KPI criteria are being applied to the contract. Multiple KPI templates can be created to allow different criteria to be specified for different types of work.

b. Details from the KPI Template are displayed.

c. For each KPI, details of how the measure is calculated are displayed.

d. For every active KPI, the following detail from the KPI Template is displayed:

Allow - a constant that is incorporated into the KPI calculation, where required

Target % - the customer-specified target that should be exceeded by Providers

Penalty - the number of points assigned for each variation from target

Variation % - the percentage variation from target that incurs a penalty

Threshold % - the Target which, if breached, may result in contract suspension

 

Example:   If a KPI has a Target of 90%, a Variation of 5%, a Penalty of 1 and a calculated KPI value of 77%, the Penalty displayed on the View KPI Results screen will be 3 to indicate the KPI Result was more than 2 variation steps below the Target. (ie a result between 85% - 90% would have incurred 1 penalty point, a result between 80% to 85% would have incurred 2 penalty point, a result between 75% to 80% would incurred 3 penalty points, etc)

 

View KPI Results

5. To view KPI Results on a Contract, do the following:

On the List Contracts screen, click the Contract #.

The View Contract – Contract Details screen appears.

6. Click the KPI tab.

The list of KPIs is displayed.

a. Only KPIs that are active on the contract display results.

b. KPIs are categorized as either ‘Delivery’ or ‘Quality’ measures. They are handled separately by the Ratings calculator and can have different weightings associated to them.

c. Three periods have been defined on the Contract Template enabling comparisons to be made of the Provider’s performance over these different periods of time. In the example below, periods of three months (Period 1), six months (Period 2) and 12 months (Period 3) are compared.

NOTE: Short period gives an indication of current behaviour whilst the longer period identifies whether this is the behaviour trend.

d. For each KPI period, the following information is presented:

Computed % - The percentage of ‘successful’ events for this KPI

Agreed % - The agreed percentage of ‘successful’ events for this KPI.  This takes into account the reversal by the customer of any ‘failure’ events.

Target % - The customer-specified success target.

Penalty - The total penalty applicable if performance is below target (see topic Create KPI Template for more details)

e. The Computed percentage for each active KPI is displayed in a different colour. Hovering over the value displays how the percentage was calculated.  For each measure, it calculates the percentage of ‘successful’ events (numerator) out of total events (denominator). Clicking on the percentage opens a new screen where failure events can be adjusted (see section 7).

f. The KPI List Report, a PDF of what is presented on the KPI tab, can be generated by clicking on this link.

Adjust KPI failure events

7. Clicking on the Computed % value for any KPI on the View Contract screen opens the KPI Events Failure screen which identifies which orders/quotes/invoices the failure(s) related to.

a. The Event Description describes the nature of the failure

b. There are two actions available to the user:

View – Open the View screen for the entity (quote, order, invoice) that the failure relates to. From the screen, the user can examine the history and access any notes and attachments to determine if there was any acceptable reason for the failure.

Adjust – Clicking on this button opens the Adjust KPI Event screen to make an exception                         for this Event and remove it from the KPI Failures. 

8. From the Adjust KPI Event screen, the user determines whether the KPI failure should be reversed.

a. To reverse the Failure Event, the user must provide a reason for the adjustment before clicking on the Make Adjustment

b. To leave this screen with making an adjustment, click on the Return to KPI Event Failures

9. After making an Adjustment, the user is returned to the KPI Event Failures screen where the Failure Event is now flagged as adjusted.

10. The Agreed column on the KPI Results screen is updated to reflect the Adjustment after the nightly KPI batch processor is run.

Tips & Troubleshooting

To return to the List Contracts screen from the Update Contract or View Contract screens, click Return to Contract List.

 

Return to the Adjust KPI Event screen to undo an incorrect adjustment.  A reason for this action must be given.

 

If a KPI Failure Event is adjusted, all KPIs that include that event in their calculations are also automatically adjusted.