“If you can’t measure it, you can’t improve it.”
Setting targets and measuring performance are critical factors that determine the success of your business. Key Performance Indicators (KPI’s) help monitor the progress of your business ensuring it’s headed in the right direction. However, the bigger question is what to measure?
The focus should be on identifying:
- The critical success factors for your business.
- Measurable KPI’s for the identified success factors.
KPIs must be defined in a manner that allows you to:
- Set targets across all the departments to achieve strategic goals.
- Identify opportunities to improve the scope of growth.
- Identify issues to implement a fix in time and avoid negative impact.
Often business owners define KPIs that are limited to sales and profits but fail to identify KPIs that impact business growth.
Identifying KPIs is the first step, the key is to conduct periodic reviews to identify gaps and, align people and processes to stay focused on your strategic goals. Consistently tracking and measuring the KPIs empowers you to take effective decisions and improve business performance.