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A Key Performance Indicator is a measurable value that demonstrates how effectively a company is achieving key business objectives. Organizations use KPIs at multiple levels to evaluate their success at reaching targets. High-level KPIs may focus on the overall performance of the business, while low-level KPIs may focus on processes in departments such as sales, marketing, HR, support and others.

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• Follow these steps when defining a KPI:

As an example, let’s say your objective is to increase sales revenue this year. You’re going to call this your Sales Growth KPI. Here’s how you might define the KPI:

• To increase sales revenue by 20% this year
• Achieving this target will allow the business to become profitable
• Progress will be measured as an increase in revenue measured in dollars spent
• By hiring additional sales staff, by promoting existing customers to buy more product
• The Chief Sales Officer is responsible for this metric
• Revenue will have increased by 20% this year
• Will be reviewed on a monthly basis