The Full form of KPI is Key Performance Indicator. KPI is a measurable value and a business metric that shows how efficiently and effectively an organization is progressing towards achieving its goals and key business objectives. There can be many Key Performance Indicators used at multiple levels by companies to evaluate growth and success in achieving their goals. In simple words, these are a set of quantifiable measures that support the company’s goals and objectives and monitor its progress over time and allow putting efforts in the right direction.
Generally, high-level KPIs may focus and monitor the overall performance of the business, while low-level KPIs focus on processes in departments such as sales and marketing, HR, support, etc. KPIs vary between organizations and companies based on their performance criteria and objectives. For example, if an automobile company’s goal is to have the fastest growth in its industry, its key or main may be the measure of revenue growth YOY (year over year). Similarly, for a departmental store, its sales’ growth would be a key metric or performance indicator to measure growth.
The common examples of KPIs are; Market Share, Customer Satisfaction Score, Number of recruitment’s, Attrition rate, Training Programs, Manpower Cost, the average length of the service of employees, sales figures over a specified period etc.