Implementation of KPI dashboards to manage credit processes

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1. Challenge

The growing complexity in the financial sector makes it difficult for banks to manage their processes efficiently. Weaknesses in the credit process often go unnoticed, leading to delays. Several VR banks also recognized this problem and set a goal to create transparency through key performance indicator (KPI) dashboards, making both the productivity and quality of credit processes visible and measurable. The project objectives included:

• Ensuring transparency regarding productivity, processing times, and the quality of loan processing
• Establishing a data foundation for the continuous improvement process (CIP)
• Implementation of an automated system for collecting and analyzing key performance indicators

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2. Procedure

The KPI dashboards were implemented at the individual VR banks in three steps:

1. Definition of Key Performance Indicators and the Data Foundation
   Incollaboration with the client, key performance indicators for targeted management (e.g., productivity and quality metrics, lead times) were first defined. In addition to agree21, other data sources containing the relevant information were identified and established. Together with the VR banks, logic was developed to cluster the individual process streams, thereby making them selectable.
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2. Implementation of the Key Metrics Dashboard
   The next step involved implementing the dashboards in Microsoft Power BI. All data was consolidated and visualized within the platform. This enables real-time monitoring of the performance and quality of credit processes.
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3. Working with Key Performance Indicators in the CIP
   Even during the implementation of the KPI dashboards, awareness was raised regarding how the new KPIs could be utilized in daily operations. Weaknesses in the credit process can now be identified and documented objectively and based on data, enabling targeted measures to be taken to improve efficiency. On this basis, a continuous improvement process (CIP) was established and the processes were sustainably optimized.

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3. Success Factors and Conclusion

The introduction of the key performance indicator dashboards enabled a sustainable improvement in quality and turnaround times by creating transparency in the credit processes. The following factors were crucial to this success:

• The use of meaningful metrics: Defining relevant metrics helped identify bottlenecks in the process and take targeted action to address them.‍
• High employee acceptance: By closely involving managers in the process and providing comprehensive training, the key performance indicator dashboards were successfully integrated into day-to-day work.
• A continuous improvement process: Cockpits have been established as a central management tool for continuously monitoring and optimizing processes.

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