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Organisations often have ideals of which kind of organisation they are, and what they want to become. These ideals might be externalised in, but ideals have to be implemented in the organisation and anchored in a common understanding to make a difference. Ideals about what the organisation is and what it should be would mean nothing if it is not translated into something measurable.

Key performance indicator (KPI) is a term for a control mechanism that can help an organization or a department assess the progress on achieving their goals. KPIs thus provide information about how the organization or department performs in relation to its goals. You can read more about KPIs here

 

Measuring KPIs from the right data can make your actions more proactive, as you will no longer have to act on previous data, as it is a real-time reporting tool. We have a useful blog post on choosing the correct data here

By using KPIs you are forced to look at the specific actions and behaviors you might use to drive you towards your goals.

When used right, KPIs keeps your strategy on track. They enable you to manage, control, and achieve your strategic goals.

 

The effects of using KPIs 

Increased motivation of individual employees

Increased transparency

Increased agility

Increased productivity

A possibility of bench marking (internal / external)

Clear and balanced expectations

Fast and continuous gathering of performance

Feedback

An organizational understanding in the individual

Support of and influence on business objectives

When setting on which KPIs to use, you will need to set a strategy and a goal of what you want to achieve. We have a blog post on using KPI’s to set and meet strategic goals here.  As you do this, it is important to involve everyone and make sure they are regularly updated on the KPIs. When people feel responsible for KPIs, they are more likely to push themselves and receive more satisfaction from a job well done. Check out our blog post on the importance of setting differentiated goals. 

Having a clearly defined KPI and goal makes it easier for everyone to talk about the progress, and to keep objectives at the forefront of decision making. As you can see, there are many reasons to use KPIs when guiding the organization towards the goal.

We hope you are now ready to embrace KPIs into your work life.  Below you can see some of the articles we have collected on how to set goals for your organization.

See our case of the Box Company, for an example of a company that did not use KPIs and suffered from it. 

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