How to Implement KPI

Written by rachel moore
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How to Implement KPI
KPI helps companies identify tasks, monitor work results and track progess. (business colleagues preparing for business meeting image by Vladimir Melnik from

Maximising performance is a critical factor in a company seeking an edge over its competition. KPI is one way in which a company accomplishes that task. KPI stands for key performance indicators. The "key" identifies the most critical and important metrics for your company. The "performance" factor measures how effective something operates and functions. The "indicators" provides feedback based on measuring the observed state or condition of the company's operation. KPI provides a framework for monitoring and guiding a company's performance and management strategy.

Skill level:


  1. 1

    Define the company values and priorities. Clearly state what your business is about. Identify what it takes for the company to be successful. For example, if you own a publishing company that specialises in publishing gardening books, the goal may be increasing books sales by 10 per cent.

  2. 2

    Identify how you area of business (e.g., human resources, sales) impacts the company. Identify the most important service or product that you deliver to customers. For example, maintenance of inventory management minimises cost management and delivers reliable products and/or services to customers such as full process rates and up time.

  3. 3

    Choose metrics that measure direct results. Metrics basically assigns a numerical value to a specific outcome. For example, a maintenance management program may set a goal for 85 per cent schedule compliance.

  4. 4

    Inform management and your business area of the metrics target and goals. Post the metric target and goals in high traffic areas of the company where everyone can see them. This serves as a reminder of how company employees impact the metric.

  5. 5

    Maintain the KPI process. Analyse how far you have come in satisfying each metric. Create a plan focused on continued improvement. Highlight and reward progress.

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