Evaluation of Cascading and Alignment of Management Key Performance Indicators

Yolanda Putri; Ancella Anitawati Hermawan

Yolanda Putri Faculty of Economics and Business, Universitas Indonesia, Indonesia
Ancella Anitawati Hermawan Faculty of Economics and Business, Universitas Indonesia, Indonesia

Abstract

This study evaluates the cascading and alignment process of Key Performance Indicators (KPIs) at PT XYZ. The issue identified in this research is the misalignment between KPI scores at the business unit level and those at the Director and Corporate levels. The study utilizes primary data obtained from interviews and secondary data from supporting documents. A triangulation method involving document analysis, interviews, and strategy maps is employed to evaluate KPIs at the Corporate, Director, and business unit levels. The findings reveal that most KPIs have been effectively cascaded, reflecting causal relationships between strategic objectives. However, misalignment was identified in Business Unit 3 due to a lack of understanding of the cascading process. This study contributes by recommending strengthened inter-unit coordination, technology-based monitoring, and enhanced understanding of KPI cascading and alignment to support the achievement of the company’s vision.

Keywords: Alignment; Balance Scorecard; Cascading; Key Performance Indicators; Strategy Maps

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