A Key Performance Indicator (KPI) is a measurable value that demonstrates how effectively a company is achieving key business objectives. It is a quantifiable measure of performance over time for a specific objective. KPIs provide targets for teams to shoot for, milestones to gauge progress, and insights that help people across the organization make better decisions.

 

 

Peter Drucker advice

What gets measured gets done.

Peter
Drucker

 

Naryana Murthy advice

A great company continuously measures and improves the following attributes: meritocracy, fairness, justice, openness, speed, imagination and excellence in execution.

Naryana Murhty

Infosys

 

Jack Welch advice business quotes

Simplicity applies to measurement also. Too often we measure everything and understand nothing.

Jack Welch

GE

 

 

KPIs help to focus attention on what matters most and create an analytical basis for decision making.

 

Balanced Company: 5 Basic Elements

 

 

 

KPIs provide a focus for strategic and operational improvement.

Managing with the use of KPIs includes:

① setting the desired level of performance (objectives / targets / critical quantifiable indicators of progress toward an intended result);

② tracking progress against those objectives.

 

 

 

KPIs vs. Metrics

KPIs are strategic.

Business metrics are primarily tactical.

KPIs measure performance based on key business goals while business metrics measure performance or progress for specific business activities.

  Effective KPIs

 

 

Effective KPIs:

Measure right things to help inform better decision making

Are strategically aligned, trickle down from the overall strategic goals of an organization

Are simple, straightforward, easy to measure, self-explanatory, and actionable

Challenge employees but donít overwhelm them... More

 

 

 

Example

When you're using social networks to drive traffic to your website, one of your most important KPIs is related to link clicks. Although if you want to build communities on social networks, setting a KPI for engagement stats is the best.

 

Social Media Marketing (SMM)

How to Analyze Your Facebook Likes and Improve Engagement

Copywriting

 

 

Jack Ma quotes

Small companies have dreams. Most of the big companies when they get to a certain size, they only have KPI.

Jack Ma

 

Vadim Kotelnikov

Measure what you value, value your measurements, and analyze them to discover new ways to create a greater value.

Vadim Kotelnikov, founder of 1000ventures - personal logo Vadim

Founder

Business e-Coach   Innompic Games icon   Innoball