What is a KPI? Why do you have to take these indicators into account?
A KPI (Key Performance Indicator) is a value, which is usually numerical (to be fully measurable) that shows whether a company or a person is meeting the objectives set at the beginning of a task, campaign or a specific period of time.
Beyond knowing if something is meeting its objectives, these KPIs are often used as a driving force to motivate us, since, as it is not subjective data, such as attitude or whether someone works well or not as a team, it is a totally measurable element that only allows a realistic reading and that supposes a goal.
What requirements must a good KPI meet?
So that we can say that a KPI is well defined (like any type of objective) we should apply what is known as a SMART Criterion, that is, make sure that it is:
- Specific (Specific): our KPI must be identified with a specific aspect in order to make an improvement comparison. The more specific you are, the easier it will be to measure.
- Measurable (Measure): Of course, it must be measurable in order to assess progress.
- Attainable: This is key. A KPI that is not attainable will not generate anything beyond frustration.
- Realistic (Realistic): This point is closely related to the KPI being achievable. We must be aware of the resources we have to overcome the KPI before setting it as a goal.
- We can frame it in a time frame (Time-frame): marking a dead-line will make us optimize our efforts and create a history with which we can compare our progress.
Are there different types of KPIs?
Depending on their typology, we can differentiate many types of KPIs. For example, within digital marketing, depending on the type of campaign or the type of channel, we can define community growth KPIs, total reach KPIs, engagement KPIs... and so on ad infinitum.
But, in reality, we like to differentiate between two large groups of KPIs:
individual KPIs
These are the KPIs that affect a single person within a team and that depend only on that specific person. For example: that a person manages to reduce the time it takes to write a post by 10% on average in a year.
collective KPIs
These are the KPIs that affect an entire group and that depend on the collaboration of all the members to achieve it, also taking responsibility for achieving it. For example: that a company increases its turnover by 5% during the year 2018.
Now that you know what a KPI is, it's time to set your own and focus your efforts on achieving them. Remember that the key to everything is to measure them, so you can set more ambitious KPIs each time.