Demystifying: KPIs
If you’re like me, you really enjoy using fancy lingo to impress fellow business folk. I mean, if speaking in a code language that only you and the other super cool people can understand doesn’t bring you back to your glory days of high school cliques, what will? Seriously though, let’s demystify one of my favorite fancy terms thrown around boardrooms- the one and only, Key Performance Indicator, or KPIs.
First things first, let's define what a KPI is. In the simplest of terms, a KPI is a metric that helps you measure the performance of your business or organization. It's like a thermometer for your company's health. Just like you use a thermometer to check your body temperature and determine if you should take a sick day, you use KPIs to check how your business is doing.
Now, let's talk about how to choose the right KPIs for your business. It's important to remember that not all KPIs are created equal. Just like not all thermometers are the same, some are better for certain things than others. (I mean, only a monster would check the temp of the Thanksgiving turkey with a candy thermometer, am I right?) The same goes for KPIs. The key is to choose ones that are specific to your business and will give you the most valuable insights.
One way to do this is to think about your business goals and objectives. What do you want to achieve? Increased sales? Higher customer satisfaction? Better job efficiency? Once you have a clear understanding of your goals, you can then select KPIs that align with those goals. I, personally, really like following the EOS model of living in the “90 day world” where you set specific goals each 90 days. This allows you to decide if the KPIs you’ve been using were useful or not.
Another tip is to keep it simple. Don't try to measure everything under the sun. Choose a few key metrics that will give you the most bang for your buck. And remember, just like too many thermometers can be overwhelming, too many KPIs can be too. (I’m imagining a sick patient with all. the. thermometers…. and it isn’t a pretty image.)
In conclusion, determining your KPIs doesn't have to be a boring task. By keeping it simple, aligning them with your business goals, and joining the ranks of the cool kids at networking events by tossing around fancy lingo, you too can achieve success!
