What is a KPI (Key Performance Indicator)?

Key Performance Indicator (KPI)

What is a KPI (Key Performance Indicator)?

Key Performance Indicators (KPIs) serve a signaling function and provide insight. They are the indicators that show whether the desired performance level of your Critical Success Factors will be achieved, or if achieving this level is at risk.

For each KPI, a standard must be set. This standard should be both ambitious and achievable. The standardized KPIs together form the main measurable objectives of your organization.

KPIs offer information that can be used to monitor the overall development of the organization. This can be done, for example, by comparing current performance with past results or with competitors. Additionally, this information can be utilized for making predictions by extrapolating the results into the future.

In practice, we see that the most measured KPIs are variants of a limited number of indicators. For example, for the Critical Success Factor 'Customer Satisfaction', common KPIs include (variants of) 'number of complaints', 'speed of complaint resolution', 'response time to customer inquiries at the helpdesk', etc.

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