Key Performance Indicators (KPI)
Key Performance Indicators (KPI) are measurable values that demonstrate how effectively an organisation is achieving key business objectives.
- Definition and Scope:
- KPI is a quantitative metric used to evaluate success in meeting targets.
- They provide an objective way to assess various aspects of performance in business operations.
- KPIs vary between organisations and industries; examples include sales revenue, customer satisfaction, and employee retention rates.
- Historical Use of Abbreviations:
- The term "KPI" emerged in the late 20th century as organisations moved towards more data-driven management practices.
- Initially used in finance, the application of KPIs has expanded across sectors such as healthcare, education, and manufacturing.
- Today, KPIs are essential tools for organisations in setting and tracking strategic goals, rooted in methodologies like the Balanced Scorecard introduced by Robert S. Kaplan and David P. Norton in the 1990s.
