Request DemoStart Trial
KPI Key Performance Indicators

What are Key Performance Indicators (KPIs)?

Share this article:
Each business and industry has its own set of Key Performance Indicators (KPIs). In the retail sector, sales are an integral part of KPI while in the motor industry manufacturing schedules could be in their KPIs. When it comes to online advertising, examples of KPI include: brand awareness, click-through rates and conversions just to mention a few. There is some form of metric measurement that can be used to gauge the performance of any business or sector and these performance measurements are what we term as KPIs. So, what is a KPI? KPI  represents measurements that focus on an organizations performance. KPIs help measure goals and are critical in the success of an organizations current and future goals.
Common Characteristics of Key Performance Indicators (KPIs)
Below are some KPI characteristics that you need to be aware of.
  • KPIs are tied to individuals The results are tied down to staff members as individuals and each individual is made aware of his or her KPIs. KPIs indicate to the staff what is expected of them in order to improve service standards and the organizations end result. KPIs make it clear to all employees on what needs to be done in order to succeed and there need to be clear distinguishers of effective and ineffective practices. 
  • They affect the overall organization The KPIs set for all employees effect the entire organization and are critical success factors. Though individual employees have their different KPIs, their results are unified in meeting the goals of the entire organization.
  • They are frequently measured In order to be successful, KPIs should be measured frequently. They are monitored on a daily basis and need to be current in order to succeed and identify future KPIs.
 3 Key Performance Indicators to Include
There is a wide range of indicators that can be included in KPIs and the three major ones are:
  1. Customer perception: Customer perception can be measured by customer satisfaction, conversion and retention as well as market share.
  2. Financial measurements: While financial measures are not the most important factor to consider when setting KPIs, they cannot be ignored. You can measure KPIs, revenue growth, return on investments, use of assets and productivity, satisfaction, conversion and retention, as well as market share.
  3. Business development and learning: Businesses development is key in KPIs and these are the measures that make it possible for an organization to improve on its practices and productivity so to remain relevant in business. The KPIs for this should be based on motivation, productivity, employee skills, employee retention, knowledge managements and much more.
KPIs are basically scorecards that are set to provide a framework for individual and team performance. They are integral in the development of an organization. However, there needs to be a balance on measurements. In other words, they should not only analyze and track employees but encourage them to be more productive and accountable. Employees need to have some degree of control of when it comes to achieving their KPIs and they should not be viewed as an opportunity for management to micromanage employees. The entire organization needs to be accountable. 

Related Articles

KPI Key Performance Indicators

KPIs: Careful Planning is Key

We’ve talked about Key Performance Indicators in the past. It’s a phrase managers of all kinds a...
November 20, 2014
Employee Motivation

Measuring Employee Satisfaction

As the effects of employee job satisfaction on a business have been well documented, taking steps to...
November 19, 2014
Employee Reward Programs

Employee KPI Measurement Tools

Key Performance Indicators (KPIs) are set to measure performance. There are different reasons why an...
May 12, 2014
2021 © REWARDCO ABN 84169704938.
playtwitterfacebookgoogle-pluslinkedin linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram