Decision-makers get company performance reports regularly. But, if they do not measure that information against something else, they cannot determine whether the company met a particular goal or not.
Quantifying a company’s current performance through key performance indicators (KPIs) will provide a framework from which a company’s progress can be assessed. Numerous companies find it challenging to track their performances due to the lack of proper KPIs or the knowledge on how to track them properly.
In this article, we’ll teach you how to measure company KPIs and how often to do it.
How to Measure KPIs?
It is necessary to decide which metrics to track before a company can measure its KPIs. This greatly depends on the organization’s objectives and teams.
Once the metrics are set, the company should focus on choosing the right targets. These are usually based on several factors, such as past performance and industry standards.
In order to correctly measure KPIs, a company needs to answer the who, when, and why.
Who is in charge of a particular KPI? Assign someone on your team to manage KPIs so that they may be the point of contact for any performance issues. This person should also be in charge of keeping track of progress.
When it comes to the “when,” it is necessary to determine the schedule for achieving these goals. Many companies schedule these on a monthly or quarterly basis. However, depending on any individual team, the timescale may be shorter or longer.
Finally, there’s the why. It’s an essential item to remember while calculating your KPIs. Having a clear understanding of a company’s objectives can help motivate your team and ensure that everyone is on the same page.
How Often Should KPIs be Measured?
As briefly mentioned in the previous section, the frequency of measuring KPIs depends on the dedicated timeframe for reaching a certain goal.
A KPI can be measured weekly, monthly, quarterly and yearly.
If a company sets a monthly goal (e.g., a monthly sales goal), it is recommended to monitor a KPI on a weekly basis. However, measuring KPIs too frequently may result in an inappropriate allocation of resources.
In addition, the frequency at which KPIs are measured depends on the characteristic of each KPI. These characteristics may be related to how often the information related to the KPI is changed or collected.
Customers might, for example, enter their level of satisfaction on a website every time they make a purchase. On the other hand, the dashboard software may collect the findings on a weekly basis, directly influencing how often a KPI can be measured.
What is your timeframe to reach a certain goal? That should be (close to) how often you measure your KPIs connected to those goals.
Don’t Stop at Measuring KPIs
KPI is a metric used to measure and track the company’s progress toward achieving a specific goal. But, just “measuring” a KPI is not enough to ensure business success. What is more important than that is analyzing the data and taking actions based on the analysis.
Not sure that you’re properly measuring your KPIs? Don’t worry; we got you covered! At HICO-Group, we offer a holistic approach to business intelligence – from KPI identification and planning to building future-proof data solutions that meet your business and market needs. We are masters in working with KPIs.
If you enjoyed reading this article, make sure to share it with others. You can follow HICO-Group on social media for the latest updates here.