What Are KPIs and Why Are They Beneficial?
Unless you’ve been living under a rock, you’ve heard of KPIs.
In case you’re not familiar with this business term, KPIs are Key Performance Indicators. KPIs are productivity management and tracking tools used in many areas of business.
In 2021, you shouldn’t still be asking, ‘what are KPIs?’ If your business isn’t using them, you may be falling behind. You can use KPIs to increase employee accountability and increase productivity in the workplace.
Read on to learn all KPI management to help you meet your business objectives.
What Are KPIs?
KPI’s give you critical information about the progress towards a goal. They provide a strategic focus and provide data that you can analyze to help meet business priorities.
A good KPI should make it evident whether you achieved the target. To do this, you need to make sure they’re objective and timebound; you can also make them comparative.
Employees can use KPIs at all levels of an organization, but they must be appropriate for the job role. For example, a call center operative’s KPI could be ‘decrease average call times from 400 to 300 seconds’. A sales director’s KPI might be ‘to increase sales by 30% in the next year’.
Why Are KPIs Beneficial?
Talk of KPIs often causes a universal sigh between employees, but there are many KPI benefits. First, they can help with employee engagement. KPIs help employees feel like they’re part of the bigger mission and show them how they can help achieve the broader business goals.
It’s essential to track KPIs, keep them relevant, and review them regularly. Most corporations use software and combined dashboards to follow any KPI progress carefully. If you’re interested in keeping all your KPI data in one place, check out this page for more information.
A group of employees working towards the same KPIs creates a natural sense of teamwork and pulling together. This is improved tenfold if you tie KPI performance to monetary compensation.
The main thing to remember about KPIs is that employees will ignore them if you don’t write them correctly. Tesla Motors speak about their KPI strategy, providing clear, motivating, timebound KPIs for all employees.
The upshot was that 83-88% of employees said their department OKRs are clear and engaging.
Examples of Successful KPIs
Hopefully, now you have some KPI ideas that might suit your business needs and improve employee engagement. But if not, here are some tried and tested examples:
- Decrease website bounce rate by 35% over the next quarter
- Increase annual turnover by 15% this year
- Reduce employee turnover by 10% by January 2022
- Improve average online response time from 3 days to 1 day during this quarter
- Win 70% of the subsequent biddable territory contracts
Making sure all your KPIs have objective measures keeps everyone accountable for how successful they were. There’s no spinning it in the best light, the KPI was either achieved, or it wasn’t.
Get Started With KPIs the Right Way
So now you know KPIs are an excellent method for measuring performance. Next time someone asks you, ‘what are KPIs?’ you’ll be able to answer without hesitation.
Why not get started with KPIs today and see your immediate business success?
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