Key Performance Indicators

What are Key Performance Indicators (KPI's)

Specific criteria used to measure the efficiency and/or effectiveness of a businesses performance, they can also provide data that can act as a driving force for change.

Why use KPI's (4)

- Identify whether objectives were achieved
- Identify which strategies were or were not effective
- Benchmarking to measure performance against competitors
- Informs a business on what area need to be addressed

10 KPI's and an important thing to include when discussing each

IMPORTANT: All are measured over a period of time.

- Percentage of Market Share
- Net Profit Figures
- Rates of productivity growth
- Number of sales
- Rates of staff absenteeism
- Level of staff turnover
- Level of wastage
- Number of customer complaints
- Number of website hits
- Number of workplace accidents

Percentage of Market Share and what it measures

- Refers to the businesses share of total industry sales
- Measures: Financial performance & Customer satisfaction

Net Profit Figures

- The revenue that remains after all expenses have been deducted
- Measures: Financial performance

Rates of productivity growth

- Growth in ratio of outputs relative to inputs over a given time
- Measures: Efficiency

Number of sales

- Volume of outputs customers have purchased from a business over time
- Measures: Customer trends, Financial performance, customer satisfaction

Rates of staff absenteeism

- The number of workers who do not turn up for work when they are scheduled too
- Measures: Staff Motivation

Level of staff turnover

- The number of staff who are leaving the business and must be replaced
- Measures: Staff Motivation

Level of wastage

- Amount of materials or products discarded
- Measures: efficiency and CSR

Number of customer complaints

- The number of customers that contact the business to express disappointment with the businesses products, quality, price or customer services
- Measures: Customer Satisfaction and Employees Quality

Number of website hits

- The number of potential customers that visit a businesses site from ads, links or social media
- Measures: Potential customers and effectiveness of marketing

Number of workplace accidents

- Number of injuries and other incidents occurring in the workplace
- Measures: Safety, efficiency and social responsibility