Key Performance Indicator (KPI)

KPI, which stands for Key Performance Indicator, is a measurable value that indicates the effectiveness of a business in achieving their key company’s objectives. KPI helps a business to set their goals, monitor the results, and check areas to be improved. The goals can vary depending on the industry but usually they are quantifiable and allows companies to make data-driven decisions.

 

E-commerce Key Performance Indicator

KPI play as an essential tool for tracking performance in e-commerces, identifying strengths and weaknesses. They also serve as measurable benchmarks against which progress can be assessed and strategical decisions can be made, and continous improvement efforts.

 

What makes a good Key Performance Indicator?

The best way to measure wether a business KPI is clear and efficient is using the SMART strategy, these five requirement will allow to provide insights that enables to make informed decision-making determinations and actions:

  1. Specific: Clearly defined and easily understood by everyone.
  2. Measurable: Able to be measured and tracked accurately.
  3. Achievable: Attainable within a reasonable time frame and with existing resources.
  4. Relevant: Consistent with the goals and strategic focus of the organization.
  5. Timely: Reflecting performance over a specific period or in real-time.

 

What are the KPIs benefits?

KPIs can ensure that your teams are advancing the general objectives of the organisation. Some of the reasons that having KPIs in your business will do are:

  • Enhances and unifies team engagement: it keeps the team aligned and working for the same direction to achieve the goals
  • Offers a clear inspection: KPI provides an overview of all the sectors in a business, making it easy to look for weaker areas to improve and those that are stronger.
  • Make the team accountable: this way the business will make sure that everyone supports value to the company, KPI also helps to track their progress.

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