Key Performance Indicators, also called KPIs, are a means to measure your business performance and track progress towards your goals. KPI tracking can be a great tool in your business intelligence tool-set. You can measure progress through KPI reports or mount them on a dashboard for increased visibility. These metrics are a reflection of your company strategy and help propel it forward.
Benefits of KPI Tracking
Even if you have set the most critical goals, if you can’t measure them, you can’t really track your progress towards them. KPI tracking provides an easily comprehensible way to measure your important business objectives. Because of this quality, a KPI can be easily understood and analyzed by decision-makers in your organization. KPIs keep you honest by making your goals measurable and trackable and hence make your business operations more streamlined.
Which KPIs Should You Track?
Every fiscal year, companies set objectives for the upcoming year and establish metrics to track progress towards these important goals. It is equally essential to track progress on a short-term as well as long-term basis. Business KPIs should be established to gauge both short-term and long-term progress. It is also imperative to not get lost in analysis paralysis and only choose the most effective KPIs for your business.
A good set of KPIs help executive management navigate their important business processes and march towards their fiscal goals. Revenue growth rate, net profit, and revenue per customer are some examples of relevant KPIs. Along with the choice of KPIs, it is also critical to establish the database where data gets collected and serves as the basis of KPI tracking.
Why Track KPIs on a Dashboard?
A KPI dashboard provides a visual into your vital company metrics. For instance, dashboards provide a quick, high-level view of your business, and at the same time give you the capability to drill down into the data for a deeper analysis. Another advantage of collecting these metrics on a dashboard is easy accessibility to the data. This keeps your entire company on the same page.
Reports are a good business intelligence tool but sharing them across a large organization can be a cumbersome task. A dashboard, on the other hand, is advantageous, especially for larger organizations. Moreover, dashboards provide real-time information about a company and indicate problems timely for investigative purposes.
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