Key Performance Indicators

Key performance indicators (KPIs), as considered here, are numerical values that allow the relative performance of systems to be considered. Studying KPIs allows us to direct an analytical light on the operations of higher education institutions. What began as a narrow, technical issue around the collection and presentation of management data has significantly contributed to, in many parts of the world, changed attitudes towards higher education on the part of students, academics, governments, and the general public. As with most data, the conclusions to be drawn from them may not be straightforward. Technical, academic, and political issues have become intertwined. This was, broadly speaking, neither intended nor expected at the outset. This entry discusses the development of KPIs, how KPIs are used, and their relationship to league tables (rankings).

[Page 898]In Britain, KPIs emerged as a national higher education issue in the mid-1980s. This followed from international studies by the Organisation for Economic Co-operation and Development’s Institutional Management in Higher Education Programme in the late 1970s. A United Kingdom 1985 report, known as the Jarratt Report after its chair (Sir Alex Jarratt), made proposals that were subsequently seen as an important shift towards introducing what became known as ‘managerialism’ in universities, with vice-chancellors designated as chief executives, rather than chairs of academically dominated bodies, the encouragement of internal planning structures and processes, and the development of other corporate-like methods. The compilation of KPIs was seen by Jarratt as a necessary development to allow effective managerial control by allowing the extent of change over time to be assessed, and cross-institutional comparisons to be made.

Developing interest in the use of KPIs reflected the expansion of higher education in Western countries in the 1980s and 1990s and a growing sense that more effective management techniques were needed to achieve effective use of the more extensive resources now involved. The Australian Vice-Chancellors’ Committee’s 1988 report, Working Party on Performance Indicators; the 1994 U.S. study by the Education Commission of the States, Charting Higher Education Accountability; and similar studies in a number of Western European countries (notably Denmark, the Netherlands, and Sweden) were part of this trend.

KPIs differ from ordinary management statistics in that they are relative rather than absolute, and so allow comparisons to be made in, it is hoped, useful ways. Knowing universities’ total spending on their libraries (a set of absolute numbers), for example, is of limited use, as the spending of a large university will almost always be more than that of a small one. Library spending per full-time equivalent student (a relative number), on the other hand, brings together library spending and student number statistics so as to allow reasonably meaningful comparisons between universities of different sizes. Perhaps the most common way of comparing resources between universities has been the staff:student ratio. At the least, comparing relative numbers in this way allows questions to be asked about what the numbers tell us about the way different universities operate, their spending priorities, and whether the interpretation of the numbers needs to take various contextual factors (e.g., subject mix or research intensiveness) into account. KPIs are therefore more useful than simple management statistics in decision-making, both within institutions and externally, as they allow more meaningful comparisons to be made. They should, however, be used to provide the questions for cross-institutional analysis, not the answers.

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