A KPI (key performance indicator) is a specific, quantified measure used to track whether progress is being made toward an objective - sales closed, defects per batch, response time, and similar. KPIs give performance a number to track rather than a subjective impression.
What it means
A good KPI is specific and measurable, tied clearly to a target, and genuinely within the influence of the person or team it is assigned to - a KPI someone cannot meaningfully affect measures the wrong thing.
Where it fits in
KPIs typically sit under a broader key result area (KRA), and they are one of the inputs an appraisal draws on when assessing whether an employee met what was expected of them for the cycle.
Key rules
- KPI = key performance indicator, a quantified progress measure.
- Should be specific, measurable and within the assignee's influence.
- Tied to a target the metric is judged against.
- Sits under a broader KRA and feeds into appraisal assessment.
