What is a key performance indicator (KPI) used for?

A key performance indicator (KPI) is a measurable value that demonstrates how effectively an organization is achieving key business objectives. In this context, measuring progress towards a strategic goal is a fundamental purpose of KPIs. They provide a clear metric that helps organizations track their performance in relation to specific objectives, allowing for data-driven decision-making and adjustments as needed.

Using KPIs related to strategic goals can help identify areas of success and those needing improvement, ensuring that the organization stays aligned with its long-term vision. This focus on strategic alignment is critical for driving growth, efficiency, and overall performance in a competitive environment. KPIs are typically quantifiable and benchmarked over time, making them essential tools for organizations striving to meet their goals.