Investigating the changing role of key performance indicators for technology and project management entities

Abstract

Key performance indicators (KPIs) at times, are vital tools because they allow entity management to understand the performance and health of the business, allowing them to make critical strategic execution adjustments to meet the entity's objectives. The main objective of this study was to investigate the changing role of key performance indicators and how they contribute to strategic competitive advantages for technology and project management organisations in South Africa. These two sectors were selected due to their more usage of KPIs and the significant economic impact on South African society. This is evidenced by higher proliferation in the adoption of KPIs and their reliance on technology by some sectors such as mining, financial services, tourism, hospitality, services, etc. Furthermore, the importance of effective project management also impacts the South African economy by reducing project inefficiencies in both the private and public sectors. The study was done by means of questionnaire as a measuring instrument. The questionnaire was developed from a literature review and guidance from research objectives and contained questions and items relevant to the initial research problem. The questionnaire comprised of fourpoint Likert scale type questions. The non-probability sampling method was applied to identify 85 participants from technology and project management entities in South Africa. Statistical analysis was performed by the Statistical Consulting Service of the North-West University using SPSS. The Cronbach's alpha coefficient was used to determine the reliability of the factors. The profile of the results was created using descriptive statistics (mean and standard deviation). The findings from the literature overview were compared to the themes discovered in the data analyses, and conclusions, and recommendations, were established. The research findings suggest that most study participants affirmed using KPIs to measure their organisational performance. They also indicated that the role of KPIs has evolved from initially having a compliance and retrospective view to the current model of being embedded with predictive insight. Therefore, KPIs are now used to review past performance, formulate and implement organisational strategies which in turn create strategic competitive advantages. Significant alignments were noted and established between the perceptions of literature and

industry regarding the purpose, roles, goals and functions of KPIs. These alignments contributed significantly to understanding the changing role of KPIs in creating competitive strategies. The main conclusion drawn from the study is that organisations should aspire to broaden the role of KPIs by having a narrow view of them as measurements tools and as tools for developing competitive strategies by corporates, especially in the current uncertain environment. It was evident from the study that the role of KPIs has changed from being compliance-based to being tools for transformation and value creation. The study results also indicate that KPIs create strategic competitive advantages through the measurement of entities' performance, creating customer integrated views, enhancing employee engagements with the organisation, being tools for leading and managing entities, and enhancing the alignment of different functions and teams with the overall organisations.