KPI - Key Performance Indicators Flashcards
What are KPIs?
A specific criteria used to measure efficiency and effectiveness of the business performance
act as a goal or guideline to measure effectiveness of changes and performance - can provide data for business change
What is used to Measure KPIs?
draw info from sources like customer/employee feedback, observation, accounting reports, marketing statistics
How do businesses evaluate their objectives using KPI?
establish objective - what they want done
Develop strats - how will they achieve objectives
eval. performance - did we achieve the objective?
info is gathered from multiple sources
What are the 9 KPIs?
Percentage of market share Net profit figures Rate of productivity growth Number of sales Rate of staff absenteeism Level of staff turnover Level of wastage Number of customer complaints Number of workplace accidents
What is ‘percentage of market share’?
the businesses share of the market/total industry sale for particular goods or services
expressed as a percentage
What is ‘net profit figures’?
profit is what leftover money there is after expenses
numbers in an income statement that tells you how much net profit you’ve made after expenses
What is ‘rate of productivity growth’?
productivity is a measure of how many inputs it takes to produce an output and how efficient it is
change in productivity in one year compared to previous year
What is ‘number of sales’?
a measure of the total amount goods or services sold in a period of time
helps gage effectiveness and evaluate performance
What is ‘rate of staff absenteeism’?
number of workers who call in sick or not show up when scheduled to
low staff attendance indicates lack of motivation or problems between employers/employees that need to be solved
What is ‘level of staff turnover’?
indicates staff satisfaction, and measures how many staff leave the business and will need to be replaced
decrease in staff turnover shows employees aren’t satisfied, quick change is major red flag, but healthy staff turnover is good for new ideas
results in recruiting and training costs, and loss of productivity
What is ‘level of wastage’?
amount of waste or unusable material produced by production
measures efficiency and use of resources
What is ‘number of customer complaints?’
customers expressing their concerns of dissatisfaction with a businesses choices or features
helps business measure effect on audience which helps them improve effectiveness
What is ‘number of workplace accidents’?
indicates how safe the workplace is for staff
unsafe workplaces impact productivity therefore efficiency and effectiveness because staff feel unsafe/unmotivated
important to HR and OPS management
What is the purpose of a KPI?
To measure if changes are successful or needed
