Use Cases for KPIs

Learn how to set up KPI calculations for various performance measurement scenarios and applications in BSC Designer.

  • Inverse/minimization KPIs - when lower values mean better performance.
  • Absolute KPIs - when performance is either achieved or not achieved.
  • Binary KPIs - when the KPI uses state-based values such as yes/no.
  • Weighted index - when sub-indicators contribute with different weights.
  • Dual scale - when progress and performance use separate value ranges.
  • Multi-threshold KPIs - when custom thresholds define underperformance or outstanding results.

Default Setup of a KPI

To create a new KPI in BSC Designer, select any item and click the Add... button. A new item will be created. By default, it will be configured as:

  • Linear maximization for the performance function (e.g., a higher value means higher performance)
  • Single scale from Baseline to Max

Inverse KPIs or Minimization KPIs

Example: “Cost per Acquisition” where lower acquisition cost means higher performance.

To implement:

  1. Switch to the Performance tab
  2. Change Optimization to Minimize value linearly
  3. Switch to the Data tab; ensure the “baseline” value is greater than the “target”

Absolute KPIs (Performance-Based)

Example: “Mandatory Training Completion” should be 100% only when all employees are trained; otherwise, 0%.

To implement:

  1. Switch to the Performance tab
  2. Change Optimization to Binary Maximize

Note: The value of this KPI can still be tracked gradually from 0% to 100%. Only the performance score is binary.

Binary KPIs (State-Based)

Example: “Regular Compliance Audit Passed” with possible states: “yes” or “no”.

To implement:

  1. Switch to the General tab
  2. Change Unit of measure to Yes/no
  3. Click the Values Editor button
  4. Adjust Update interval type; change Values inheritance to Use inherited values

Static KPIs

Example: “Environmental Emission Limit” set annually as CO2 tons/year by the regulator.

To implement:

  1. Switch to the Data tab; update the current and target states of the indicator
  2. Click the Values Editor button
  3. Change Values inheritance to Use inherited values

Optional: Adjust Update interval type if the indicator should be revalidated in the future.

Weighted Index

Example: “Risk Index” with “Major Risk Events” weighted at 80% and “Minor Risk Events” at 20%.

To implement, for sub-indicators:

  1. Switch to the Performance tab
  2. Change Weight

For the index indicator:

  1. Switch to the Performance tab
  2. Set performance to Weighted average

Calculated KPI

Example: “Return on Investment (ROI)” calculated as: (Net Profit / Investment Cost) × 100

To implement:

  1. For the “ROI” indicator, follow the steps to set up the formula

For indicators in the formula:

  1. Switch to the Performance tab
  2. Check Raw data indicator to stop calculating individual performance

Dual Scale KPI

Example: “Employee Satisfaction (%)” with min = 0%, max = 100%, baseline = 60%, target = 80%.

To implement:

  1. Open the Data tab
  2. Disable Simple input mode
  3. Input minimum, maximum, baseline, and target values

Optional: Configure the KPI table to show progress (baseline-to-target) and performance (min-to-max).

Multi-Threshold KPI

Example: Quarterly Sales, $ with target = $1,000,000; underperforming (0% progress) = 25% below target; outstanding (105% progress) = 5% above target.

To implement:

  1. Switch to the Performance tab
  2. Click the Edit button Edit button for Optimization formula
  3. Click Add to define a custom formula: if Value < target * (1 - 0.25), then 0
  4. Click Add to define a custom formula: if Value > target * (1 + 0.05), then 1.05
  5. Save the formula
Multi-Threshold KPI setup in BSC Designer

For values between the defined thresholds, the system applies linear scaling according to the Default formula.

Graded KPI (Qualitative Scoring)

Example: Supply Chain Performance Rating — using qualitative labels mapped to ranges: Underperforming = below 60%; Acceptable = 60–80%; Excellent = above 80%.

To implement:

  1. Switch to the General tab; click Edit button Edit for Unit of measure
  2. Create a new unit (e.g., Qualitative Scoring) and add captions:
    • Underperforming = value 0
    • Acceptable = value 60
    • Excellent = value 80
  3. Set Value matching to By Range

Units editor showing qualitative scoring (Underperforming, Acceptable, Excellent)

The indicator is now configured to work with qualitative labels. If needed, a quantitative indicator can serve as a data source (i.e., a performance grading case):

  1. Switch to the Data tab
  2. Click the Data Source button
  3. Choose Formula and specify the quantitative indicator that provides the data.

Shared Initiatives and KPIs

Example: One initiative supports several KPIs, or the same KPI is reused to quantify multiple initiatives.

By default, the hierarchical structure in BSC Designer uses a many-to-one contribution model, where multiple items (such as KPIs, initiatives, or subgoals), contribute to one parent item, such as an objective.

A child item can also be connected to other items outside its parent hierarchy. This is useful when one initiative needs to support several KPIs, or when the same KPI should quantify several initiatives.

To implement, follow the steps for alignment by goal, data, or context:

  1. Copy the child item
  2. Paste it to the new parent item
  3. Select the type of connection: By data or By context

For connections by data, switch to the Context tab and adjust the Parent progress impact setting of the copied item if needed:

  • Use Lagging if the item should directly impact the parent item’s performance;
  • Use Leading if the item should impact only the parent item’s leading performance, but not its outcomes.

If a contextual connection is selected, it will be displayed on the Context tab, as well as on the Gantt diagram.