KRI (Key Risk Indicators) – Do-s and Don’ts:
March 23rd, 2010
Comments Off
| Back to the KRI product |
 Download KRI Toolkit for FREE. Download now! |
Do-s:
- Efforts should be made to use quantifiable KRI.
- The methods and approaches used in the development, implementation and maintenance of KRI should be consistent.
- A long term check of the KRIs should be maintained against the specifications and standards set.
- KRIs should be in sync with the objectives and goals of the organizations.
- Relate to risk owners: KRI should work in the favor of the stake holders, as prosperity of stake holders is one of the main objectives of any business.
- KRI should be able to measure up to a range of risk that may emerge in a particular domain of its coverage.
- The KRI must be adaptive and responsive to market dynamics.
Don’ts:
- While designing a KRI, Do Not induce unnecessary complexities in the risk measure.
- Although KRI should be simple, but it should not be too narrow as this would defy the very purpose of KRI. Do not make the KRI very limited in scope.
- Don’t rely completely: Don’t rely on initial KRI completely. It should be tested time and again for improvement and changes.
