Choosing the Right KPIs for Your Organization

  • By AFP Staff
  • Published: 4/8/2024
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Selecting the right KPIs involves careful consideration of your objectives, identification of key metrics, and ensuring relevance to industry and organizational priorities.

Keeping the KPI selection process simple yet targeted, with a focus on a few meaningful metrics, allows for the clear measurement of success and progress.

Choosing KPIs that are quantifiable, actionable and provide timely insights is essential to enabling decision-makers to take prompt and informed actions. You should also be sure to include a balanced selection of KPIs, as this allows for a comprehensive assessment of performance.

Moreover, considering factors such as comparability, resource availability, and alignment with organizational culture ensures that the KPIs that are chosen are relevant, measurable and conducive to driving desired behaviors.

Below is a list of example KPIs for internal and external stakeholders and business partners, sorted by process and further broken down by area of the business.

Example KPIs for Business Processes

KPIs for R&D

  • Time to market
  • Budget conformance within 5% overage
  • Success rate (e.g., number of products/service profile characteristics achieved in final version, revenue produced by new product)

KPIs for Operations

  • Revenue per measure of space or capital invested in operations
  • Percentage of orders filled accurately and on time
  • Rate of returns related to product defect
  • Inventory turns
  • Number of workplace accidents

KPIs for Marketing

  • Cost/unit of traffic
  • Promotion return on investment (i.e., revenue/leads generation)
  • Market share
  • Customer brand awareness level

KPIs for Sales

  • Lead conversion rate
  • Number of calls per day
  • Number of new accounts
  • Increases in sales volume per account
  • Customer satisfaction with sales experience

KPIs for Customer Care

  • First call success rate
  • Number of calls handled per hour
  • Average length of calls
  • Customer satisfaction with service experience

Example KPIs for Support Processes

KPIs for Information Technology (IT)

  • Number or frequency of network outages
  • Repeat problem rate
  • Level of internal client satisfaction

KPIs for Facility Management

  • Increased energy efficiency of buildings
  • Space utilization (occupancy rate)
  • Level of tenant satisfaction on surveys

KPIs for Purchasing

  • Contract accuracy
  • Audit confirmation of at least 95% compliance with policy
  • Internal customer satisfaction
  • Unit change in purchased material price

KPIs for Human Resources

  • Recruitment response rate
  • Cost per new hire
  • Percentage of new hires reaching 1-, 2- and 3-year employment marks
  • Percentage increase in benefit cost
  • Levels of employee satisfaction with benefits package
  • Employee complaint rate

Example KPIs for Finance Support Processes

KPIs for FP&A

  • Percentage variance from project timelines and budgets
  • Percentage of unfulfilled project objectives
  • Number of reports with missing data
  • Number of post-delivery revisions and revision cycles
  • Customer satisfaction scores
  • Performance of post-project debriefings and implementation of action items

KPIs for Accounting

  • Time to close books
  • Audit score

KPIs for Treasury

  • Attainment of target cash reserves
  • Foreign exchange exposure
  • Targeted portfolio risk level
  • Composition of debt portfolio

KPIs for Tax Compliance

  • Effective tax rate
  • Effectiveness of communication with board and senior management
  • Number of workshops held
  • Memos issued concerning tax codes

Example KPIs for External Partners/Stakeholders

KPIs for Banks

  • Volume of customer fees generated
  • Volume and quality of assets under management
  • Portfolio risk level or score

KPIs for Investors/Shareholders

  • Targeted return on equity
  • Percentage of dividend growth

KPIs for Sourcing Partners

  • Partner satisfaction (based on customer expectations of KPIs such as accuracy and timeliness of deliveries, number of incomplete deliveries, number of non-conforming deliveries that had to be returned)
  • Inventory turns
  • Logistics efficiency (e.g., number of deliveries per truck per day, number of packages mailed)

Be sure to conduct regular reviews of your chosen KPIs and refine them as necessary to maintain their effectiveness and relevance over time. This fosters a culture of continuous improvement and helps drive the organization toward its goals.

Learn more about business performance management.

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