Key Performance Indicators are performance measurements that help you know if your business is reaching its goals and operating optimally. Use a KPI checklist to help you measure, detect and respond to dips in sales and margins and other strategic facets of your business.
KPIs support your strategy and help your teams focus on what's important. An example of a key performance indicator is, “targeted new customers per month”.
A KPI is short for a key performance indicator, a measurable and quantifiable metric used to track progress towards a specific goal or objective. KPIs help organizations identify strengths and weaknesses, make data-driven decisions, and optimize performance.
Performance Management Buyer's Guide
Employee key performance indicators (KPIs) are objective performance standards that set benchmarks for success. KPIs quickly reveal whether your employees are on track to meet their goals. They reduce bias, increase transparency, and provide insight into performance trends.
Make sure they're Specific, Measurable, Attainable, Realistic and Time-Bound. *Pro Tip: Starting a KPI with a verb tells you what needs to be done. Assigning a value ensures your KPI is measurable, and a timeline will do wonders for staying timely on your progress.
Types of KPIs include: Quantitative indicators that can be presented with a number. Qualitative indicators that can't be presented as a number. Leading indicators that can predict the outcome of a process.
There is no surprise that sales growth is seen as one of, if not, the most important KPIs for marketing managers and businesses in general. Sales growth is what any business owners strive for, what investors care about, and what employees are working hard towards.
In simple terms, KPI is a goal that you work towards achieving. For example, your goal for 2022 might be to 'Get 500 new customers for your product. ' Therefore, the KPI to track here is the 'Number of New Customers Acquired.
The term “objective-key performance indicator” (OKR) is often used as a synonym for key performance indicator (KPI), but there is a difference between the two terms. An OKR is a statement about what an individual or team wants to achieve, whereas a KPI measures a particular performance.
There are many methods to track KPIs; you can track them via Google Sheets, Google Analytics, or by using kpi tracker to build dashboards. From the three methods mentioned above, tracking KPI by building dashboards is the most effective way.
Try not to have too many KPIs: the optimum number for most areas of a business is between four and 10. Just make sure that you have enough to measure how your team or organization is performing against your key objectives.
As an example, a marketing department might track the number of new leads generated. A KPI will normally have a specific deadline and uses metrics to track the progress towards a target. For example, the same marketing department might set a KPI of increasing the number of new leads by 25% in Q1.
KPIs are important because it gives you a value to compare against your current performance. KPIs clearly illustrate whether or not you are reaching your goals. Implementing KPIs in your company means you can set goals, devise a strategy to reach your goals, and evaluate your performance along the way.
Measurable. It might seem obvious, but a KPI should be easy to measure. An effective KPI avoids generalized goals like, “Improvement in warehouse department.” Instead, an effective KPI should be based on a solid, focused goal that can produce qualitative and quantitative measures.
Worst KPIs to track: KPIs that are too vague
If an employee performance indicator is too vague, employee engagement can easily suffer as your people struggle to meet their goals. For example, say your business had a KPI along the lines of “make the workplace neater” or something else similarly vague.
This can cause employees to work towards something in the wrong direction, or not work efficiently with the goal in mind. The point is KPIs are synonymous with goals during a project and without these goals to check in on how your team is doing, they are unlikely to accomplish what they set out to do.