What are KPI?
Key Performance Indicators are key measures that gauge the success of the organization in a particular area, usually impacting the bottom line. These KPI(s) are: • Quantifiable • Measurable today and over time • Assessed regularly against preset corporate targets • Tracked by decision makers throughout the organization • Tracked across key Dimensions/Variables (time, product/product line, department, geographic location, sales rep, etc.) There are two types of key performance indicators: • Lagging Indicators (typically financial) • Tells us how the organization has performed in the past (Revenue, Cost, Margin, EPS, etc.) • Leading Indicators (non-financial) • Tells us how the organization is performing now • Predicts likely future financial performance (Number of returns, on-time delivery, market share, etc.) Organizations have typically not done a great job tracking these leading indicators, although these leading indicators serve as our crystal ball in determining likely future finan
