Definition of KPI 

A Key Performance Indicator (KPI) is a measurable value that demonstrates how effectively an organization or individual is achieving specific objectives and goals. 

KPIs are used to evaluate performance over time, providing insights into the success or challenges of a particular activity or process.

Explanation of KPI 

KPIs serve as critical metrics to assess the progress toward strategic objectives. They help in quantifying performance, identifying areas for improvement, and making informed decisions to drive success.

Example of KPI 

• Sales growth rate: A KPI for a sales team, measured by the percentage increase in sales revenue over a specified period.

Strategies of KPI 

• Alignment with Goals: Ensure that KPIs align with the overall goals and objectives of the organization.
• Regular Monitoring: Continuously monitor and analyze KPIs to stay informed about performance trends.
• Benchmarking: Compare KPIs against industry standards or past performance for context and improvement opportunities.

Related terms

• Metrics
• Performance measurement
• Balanced scorecard
• Key result area (KRA)
• Dashboard

Note: KPIs are highly context-dependent and can vary across industries and business functions. It's crucial to define and choose KPIs that are directly relevant to the specific goals and objectives of the entity being measured.