What is the full form of the KPI?

The full form of KPI is the Key Performance Indicator. The critical measures of success towards an intended outcome are KPIs. It has an orientation for strategic and organisational change, creates an objective basis for decision-making and helps to concentrate on what matters the most.

Simply put, KPIs are a collection of quantifiable indicators that promote the strategic goals of the organisation and enable yourself to put the efforts toward achieving and measure your progress over the period. Usually, high-level KPIs track the organisational performance, whereas low-level KPIs concentrate on departmental functions including marketing, support, HR, advertising, and so on.

Types of Key Performance Indicator

When the company knows how different metrics are being used and how different kinds of indicators contribute to the view about the organisation performance. It is possible to categorise KPIs into many different categories that are listed below.

1. Process KPIs measure the efficacy of business operations, such as the time needed to produce a request. High performance can be seen by an order supplied in less time.
2. To generate business outcomes, input KPIs evaluate expenditures like assets, capital, or money invested. For instance, cash was spent on training, raw materials, study, and development of employees.
3. Output KPIs calculate the non – financial and financial performance of products and manufacturing processes, like income generated, the introduction of total subscribers, the introduction of total admissions, and so on.
4. Leading KPIs to evaluate the advancement of activities that could have an impact on potential results. Such metrics provide feedback on future outcomes.
5. Lagging KPIs measures the strength or weakness of operation; for example, the performance of the previous activity is calculated by financial KPIs. These metrics will tell you what you achieved.
6. Qualitative KPI is a subjective aspect to such metrics. It is a descriptive function, an opinion, a property, or a characteristic. For example, a business collects information to assess client or customer satisfaction.
7. An observable feature that includes numbers is quantitative KPI. By adding, counting or averaging figures like the number of sales, the number of admissions, calls handled, and so on, it evaluates a measurable feature.

Examples of KPIs

Few examples of KPIs are listed below.

• Customer Satisfaction Score
• Rate of attrition
• Industry share
• Cost of human resources
• Training Programs
• Number of Hirings
• Sales figures over a specified period
• The average length of employees’ service