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Key Performance Indicators

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Key Performance Indicators or KPI are financial and non-financial metrics that are used to gauge the performance of an organization against its goals. Key Performance Indicators are made up of three main precursors: measurability, team acceptance and conformance to organizational goals. Therefore, a business must carefully define its goals before Key Performance Indicators can be implemented. Usually, Key Performance Indicators are chosen factors that directly or indirectly play a part in product or process effectiveness. Key Performance Indicators should be the same from year-to-year. Examples of Key Performance Indicators include percent of income from repeat customers or annual increases in units sold. In business intelligence, Key Performance Indicators are used to assess the current status of a business and help to define an intended course of action. Like other financial measurements, Key Performance Indicators differ from business to business and from industry to industry. Key Performance Indicators are also known as Key Success Indicators (KSI).

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