What Are KPIs

In this set of modules, we are going to look at what KPIs are, and how they can benefit your business if used properly.

We will consider how they should be written, by whom, and when.

We will look at some examples of KPIs across different levels of the business and consider the importance of them being aligned with the company strategy.




Writing effective KPIs is quite a skill which we will help you to develop. Then we will consider the importance of monitoring and reporting on KPIs and using them to achieve targets set. We will end with some KPI best practices.

What are KPIs?

They are Key Performance Indicators; a set of quantifiable measures that can be used to gauge performance in terms of meeting defined and agreed strategic and operational goals. They show the progress of a company, team or individual towards a goal.

They measure how effectively key business objectives are being achieved and evaluate and quantify success at reaching targets. Used correctly, they should help you to see aspects of your business performance you may not have otherwise been aware of.

To write effective KPIs you need to have a business strategy already defined. The KPIs are the tactics by which you will achieve the strategy.

They should be KEY – focus on mission critical business activities

They should relate to Performance

They should measure activities and processes that are within the control of the jobholder.

They must be aligned to the Vision and Strategy of the business. From these follow the objectives and the critical targets. Once you define what the targets are that will drive the business success, the KPIs will follow from them.

Who should write KPIs?

Any business owner, executive or manager who is responsible for the performance of staff should write KPIs. This enables them to ensure managers, departments and individual members of the team are working towards the same goal, aligned with the company strategic direction.
When do you need to write KPIs?

The optimum time to do this is in preparation for a business cycle, such as a season, financial quarter or year, or the launch of a specific project. Get them ready and share them in plenty of time so that teams can use them to influence their own planning before the cycle starts.

Time scale

Whether your KPIs should be aimed at achieving short, medium or long-term objectives, is always a vexed question, and ultimately depends on the business and its operations. Generally speaking the operational staff are probably best aiming for short term objectives, with management aiming for medium term, and executives aiming for long term objectives.

In today’s fast-moving world, the likelihood is that short term is 6-12 months, medium term is next year, and long term is within 2/3 years

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