Key Performance Indicators (KPIs) for Administrative System

This article discusses the KPIs for administrative system, usage and security guidelines, and monitoring report. It also presents four options for potential system modifications and recommends two of them. The article concludes with an induction plan for the managers.

MonitoR aDMINISTRATIVE sYSTEM
Assignment 2

Key Performance Indicators (KPIs) for administrative system
System performance criteria
The criteria for the performance of expense approval system for Woolworths is to compare the
amount of costs reduced and degree of efficiency improved within the decision making ability of
the store managers. Hence, the system performance criteria has been outlined below:
1. Costs reduced by system post one month of implementation
2. Decision making efficiency improved towards purchasing products
3. Overall cost benefits realised by the system in duration of 30 days
The established criteria for the system performance will enable identification of the effectiveness
achieved by the administrative system.
Usage guidelines
It is important to consider that the users are require to identify whether or not they are getting
accurate recommendations for the repurchase of products and the extent to which they are
required to wait before placing the orders once the system recommends to make purchases. The
managers are subject to approving or rejecting the request for purchases for products that are
about to reach out of stock status.
Security guidelines
The security guidelines for the system is that the passwords of the store managers needs to be
changed every month or 30 days to ensure that any unauthorised access are prevented.
KPIs
Following are the key performance indicators of the system:
1. Cost reduction achieved in 30 days
2. Number of users able to use the system
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3. Number of errors within 30 days
4. Number of false recommendations provided
Monitoring report
Monitoring data
The monitoring data presented below indicates the manner in which the system performed
against the time defined KPIs:
Cost Reduction
Prevented additional purchases
Cost benefits from just-in-time approach
Expenses caused by system
$0
$200
$400
$600
$800
$1,000
$1,200
KPI 1: Cost reduction
Cost Reduction Prevented additional purchases Series3
2

Ease-to-use Complex
0
100
200
300
400
500
600
700
800
900
KPI 2: Ease-to-use
Ease-to-use Complex
Start-up failure Not-responding System failure Unable to access
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
KPI 3: Instances of errors
Series 1
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Correct Recommendations False Recommendations
0
1000
2000
3000
4000
5000
6000
7000
KPI 4: False expense approval recommendations
Description of procedures
The monitoring of the system was approached as a follow up research. The need for the system
to be evaluated was communicated to the employees wherein the store managers were notified
about it through the email. The requirement for follow up was communicated as a method
through which performance of system can be identified for the future improvements. Hence, the
four KPIs were developed and questions were asked to the managers to obtain their responses.
Analysis of monitoring data and research in changing needs of business
The monitoring data presents direct insight to the four distinct KPIs. While the first chart
indicates that the system did not cause any additional expenses to the management and instead
enabled cumulative cost benefit of over $2500 in the first 30 days of operations. The second
chart indicated that as much as 825 store managers found the new expense approval system to be
easy to use from the brief questionnaire. The responses were obtained in the form of Likert scale
ranging from 1 to 5. However, 170 managers highlighted that the system was complex to use.
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Apart from this, four technical issues were identified to be possible such as the start-up failure,
system failure, no response and inability to access the system. It was found that problem of not
responding was prevalent as indicated by the four separate instances. Therefore, there lies a need
to improve the situation of technical glitches. The following section of this paper presents the
four options for the potential system modification followed by evaluation of the options.
It was further identified 5987 correct recommendations were provided to the managers by the
system which resulted in the cost benefits and improvement in the decision making abilities of
the manager. However, 873 recommendations were identified to be false by the system. This
poses a critical concern that the possibility lies wherein a manager can develop dependence on
the system with time and to avoid time consumption in manual verification, wrong approvals can
be made.
Evaluation of four options for potential system or procedure modification
Following are the four options for the potential system modifications with subsequent evaluation:
1. Involving the stock members of Woolworths to verify the number of products of same
category in stock to avoid overload on managers
This option will not be suitable as it will create dependence for managers on the stock members
for accuracy in manual verification.
2. Modifying the system to obtain insight from inventory system for available products
This option can be considered as it will identify the number of products reduced from inventory
system.
3. Modifying system to deduct products on the basis of sales order
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This options can be further considered as it will enable system to identify which products were
reduced from inventory and number of available products automatically which will eliminate the
need for human verification.
4. Retraining the managers with perception of system to be complex
This option can be complementary activity but not a core activity to improve the system
efficiency.
Recommendations and supporting evidence for two of four modifications
It is recommended that Woolworths further modifies the system by making it interact with the
inventory and sales order system to automatically determine the available orders.
Communication to users outlining changes to system
An email was sent to the 995 store managers of Woolworths outlining the system modifications
that are required to improve the system on the basis of monitoring data and that their support will
be required. Following email was sent organization-wide:
To: [e-mail]
CC: [e-mail]
Subject: Support required for the system modifications arising from monitoring data
Dear Managers,
The monitoring data has indicated that making the expense approval system interact and obtain
insight from the inventory and sales order systems will be important to improve the accuracy of
recommendations and remove the need for manual verification. Therefore, your support will be
required in all aspects to enable us in removing your additional workload.
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Thank you!
Induction Plan
Skills required to perform the administrative task
The administrative task of approving the expenses for reordering the retail products in the 995
will require each of the store manager to consider seasonal and customer demands before
approving the purchase orders to suppliers. Therefore, customer centricity and problem solving
skills are required from managers.
Learning delivery mode
Virtual training will be delivered to the managers through their workstations and mobile devices.
Copies of Training Policy
Training will incorporate virtual training in addition to both classroom and on-job training.
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