What is kpi?
A KPI, or Key Performance Indicator, is a simple, measurable number that shows how well a person, team, or company is doing at reaching its most important goals.
Let's break it down
- Key: the most important thing to watch.
- Performance: how well something is working or being done.
- Indicator: a sign or signal that tells you something. Put together, a KPI is the most important sign that tells you how well you’re performing.
Why does it matter?
KPIs turn vague ideas like “be successful” into clear numbers you can track. They help you see if you’re on the right path, spot problems early, and make smarter decisions based on real data instead of guesses.
Where is it used?
- Business: sales revenue, profit margin, customer churn.
- Marketing: website traffic, conversion rate, cost per lead.
- Product development: feature adoption, bug resolution time.
- IT/Operations: server uptime, incident response time.
- Human resources: employee turnover, training completion rate.
- Personal life: steps walked per day, monthly savings amount.
Good things about it
- Gives everyone a common focus.
- Makes progress easy to see and talk about.
- Helps prioritize work that really moves the needle.
- Provides early warnings when something is going off track.
- Encourages data‑driven decision making.
Not-so-good things
- Badly chosen KPIs can lead you to chase the wrong results.
- Too many KPIs overwhelm people and dilute focus.
- Numbers can be gamed or misinterpreted if not measured correctly.
- Over‑reliance on metrics may ignore qualitative factors like employee morale or brand reputation.
- Constant tracking can create pressure and reduce creativity if not balanced with flexibility.