A Key Performance Indicator (KPI) enables a business or organisation to measure how effectively they are performing specific tasks or meeting their targets.
Key performance indicators can be set across the whole organisation. Alternatively KPIs may be defined for departments, operations and projects. They can also be used to measure individual performances.
SMART goals are Specific, Measurable, Achievable, Realistic, Reported and Time Bound.
KPIs are often set as ratios, to measure business performance through the relationship between two key variables.
KPIs are an important component within management systems as means of measuring the level of success in achieving, and hopefully exceeding, the organisation's goals.
One of the great benefits of KPIs is they can be explained to everyone, so the entire workforce from the bottom to the top, has a clear understanding of what objectives the organisation is targeting and the progress being made
ISO 50001 uses the term EnPI - energy performance indicator. ISO 14001 uses EPI - environmental performance indicator. ISO 9001 quality management systems use KPIs extensively to track customer satisfaction, production of goods and service delivery.
Whatever they may be called KPIs are an essential component to measuring the effectiveness of business performance and goal achievement.
03 August 2015