Key Performance Indicators (KPIs) assist business owners in measuring the growth of an organization. Often, KPIs are evaluated to establish long-term goals. Typically, the KPIs for an organization remain consistent and are not modified unless the company’s mission or goal is changed.
In addition to being measurable, KPIs also share the following characteristics:
- They are well-defined, specific and not vaguely-worded
- They are meant to be actionable
- Applicable to different areas within a business, if warranted; for example, in a large ecommerce setting, the KPIs for marketing may differ from those for shipping
- KPIs typically have an established time-frame and can be used to chart and measure improvement across this time- frame
Following are examples of KPIs for a few selected industries:
Retail Industry:
In the retail industry, KPIs help analyze the mission of the business and define short and long-term goals.
- Loss prevention, including reducing cash losses and loss of equity (shares)
- Annual turnover in sales
- Streamlining operations in terms of updated inventory
- Salary and payroll
- Accounting for variable costs and expenses
- Staff training and development
Professional Services
Professional services can have a number of different goals. KPIs for professional services typically follow the SMART rule: specific, measurable, achievable, realistic and timely.
- New business and incremental clients
- Percentage increase of profit margins
- Percentage of billable versus non billable hours
- Employee training
- Employee retention
- Training costs and expense
Ecommerce
KPIs are of vital significance in ecommerce for several reasons, including shopper behavior. User behavior while on your website impacts several things, including the visitor stopping to browse merchandise, choosing a product, and finally purchasing it. Conversely, the visitor may not ever convert to customer status.
- Number of visitors to your website
- Number of new customers
- Page views for your website
- Time spent on the site
- Number of orders you logged within a time frame
- Pay-per-Click conversions
.svg)
.svg)
