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.