Turning Data into Direction: Building KPI Discipline in Equipment Finance

Ellen Comeaux, a Director with The Alta Group, has seen the superpowers that KPIs can deliver to equipment finance companies. Tracking the right metrics yields valuable insights for greater efficiency, profitability, and competitiveness. Unfortunately, many equipment finance teams are drowning in rivers of data instead of focusing on the metrics that really matter to their businesses. 

“I’ve seen quarterly review decks balloon to 80 pages or more as, month after month, a shiny new metric gets added to the list to track — and remains there indefinitely. But data for the sake of data is not enough to justify the valuable time and limited resources it takes to track and manage it all,“ writes Comeaux in the latest issue of Monitor.  

“What’s key is ensuring you track the right metrics and elevate the most important ones as Key Performance Indicators (KPIs).” 

If you think KPIs are not part of your job description, keep reading. Comeaux says that everyone can benefit from learning about the KPIs vital to their business, even if other leaders are responsible for them. 

Her Monitor article focuses on helping companies identify the KPIs necessary for achieving measurable improvements. She advises businesses to start by clarifying their success drivers. Next, make sure everyone in the organization understands how success is defined and measured. Then, curate the data — focusing only on the essential KPIs. 

Read the article. 

Start with Success Drivers 

KPIs are measurable values that companies can use to gauge how well they are achieving specific objectives. Few of the metrics that businesses routinely track qualify as true KPIs, Comeaux says, and a KPI that is important to one business may be merely a footnote for another. 

Before identifying KPIs, a business must clearly understand the factors driving success for the organization as a whole and for functional teams and business lines within it. Comeaux’s article cites examples of potential success drivers for equipment finance companies. She also describes five key reasons that KPI efforts must begin by looking at success drivers, ensuring the metrics tracked will deliver: 

• High-impact focus. 
• Informed decision-making. 
• Proactive problem-solving, performance monitoring, and evaluation. 
• Effective communication. 
• Competitive advantage.

Select Meaningful KPIs 

Once an organization zeroes in on the success drivers critical to the business, it’s time to identify the metrics that will deliver the greatest impact. The article provides multiple examples of KPIs relevant to equipment finance businesses. It highlights seven crucial criteria for designating metrics as KPIs, and five additional factors to consider when identifying or reviewing them. Comeaux also shares examples of focused KPI efforts that have helped companies in the equipment finance industry. 

“By selecting and prioritizing the most important KPIs, organizations have the data needed to stay on the right path — or course-correct when issues arise,” Comeaux writes. 

So, how many are too many KPIs? She advises businesses to begin by focusing on five to seven metrics, and no more than 10.  

“Less is more here, as tracking too many KPIs can dilute the effectiveness of a company’s efforts,” she says. 

Data-Driven Results with Alta 

The Alta Group’s global team of advisors can help your organization focus on the data insights that matter most for business success—then work with you to achieve measurable goals. We bring decades of specialized expertise in equipment finance to the table, along with exclusive resources, such as our database tracking industry performance over three decades and numerous economic cycles. We put these tools to work to inform your business strategy and help you evaluate market opportunities, assess risk, structure innovative funding models, achieve new levels of operational efficiency, and enter new verticals with confidence.  Let’s talk about how we can support your growth.  

Comeaux is a Director with The Alta Group’s Strategy & Competitive Alignment Practice. She draws on more than 30 years of experience in commercial finance, banking, and strategic development for the article, as well as her work as an instructor for the STRIPES Leadership Program in partnership with Monitor.