Keeping up with KPIs: How to Develop and Track Key Performance Indicators
It’s easy to say you want to be a millionaire, but as we all know, actually becoming one is very difficult.
We can’t all be lucky enough to just stumble our way into wealth and riches, the rest of us have to put in the time and effort to make our financial dreams come true. Unfortunately, most people don’t have the drive or dedication to properly plan out how they want to go about achieving their idea of success…but if you’re reading this, then you’re not like most people, are you?
No, you’re not content to spend your days wishing for what could be. You’re willing to chase your goals, you’re ready to make your fantasies a reality, you just don’t know how. Motivation may be an excellent source of fuel, but a full engine without a proper heading won’t get you where you need to go. Don’t be discouraged, you’re on the right course, you just need to map out the rest of the route, and you can do so by setting Key Performance Indicators, or KPIs.
KPIs are metrics used to gauge success, be it the success of an individual marketing campaign or the success of a company as a whole. They can be set for small projects or large organizations alike, determined across anywhere from a month-long timeframe to a span of several years.
As you can see, KPIs are relative to who is setting them and for what objective.
A large company may set KPIs to measure profit fluctuations and employee retention over a five-year period, whereas a small startup would be more interested in task completion rates and sales figures on a week by week basis. A manufacturing company would want to measure how efficiently they’re producing products and utilizing raw materials, while a charitable organization would be more concerned with tracking fundraising milestones and monitoring how effectively they’re combatting their respective cause.
KPIs are typically set by working backwards from the end goal, determining what it is you want to happen and when you want it to take place, laying out what steps need to occur in order for the end goal to be achieved. Planning ahead like this is very useful for exposing unattainable goals or unrealistic timeframes, thereby allowing you to make necessary adjustments to your strategy either before you put your plan into action or after you’ve analyzed the resulting data from trying and failing to reach the KPIs you initially set. Don’t be afraid to change your plans if the metrics aren’t falling where you want them to, that’s precisely why you’re measuring it in the first place. That annual goal you set for yourself will still be waiting for you at the end of the year, reviewing your progress month by month will reveal if your strategies aren’t working early on, and you’ll be able to test new methods and measure their effectives as you go.
In order to avoid aiming too high and being disappointed when you miss the mark, be sure to consider all the factors behind your goals. Take into account the effort required to achieve them, the amount of time such effort will call for, the cost of investing so much effort over so much time, the budget you have to work with, and the value of the outcome compared to everything it took to make it happen.
Temper your expectations, account for how catching mistakes and implementing remedies will impact the cost and schedule, and please, give yourself and your team some wiggle room so you won’t be scrambling to catch up after a single misstep.
You’ll never be able to account for everything, but the better prepared you are from the start, the better your chances of reaching your goals at the end.