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Key Performance Indicator (KPI)

What is a key performance indicator (KPI)

Main HR glossary Key Performance Indicator (KPI)

Key performance indicator (KPI) is a metric that is used to measure success in achieving company, department, or individual goals. KPIs help assess how effectively tasks are being completed and whether desired results are being achieved.

For example, in a sales department, KPIs might include the number of deals closed or total revenue generated. In HR, relevant KPIs could measure turnover reduction or time-to-fill vacancies. Each KPI is developed based on the nature of the work and the company’s strategic objectives.

It is important that KPIs are measurable, achievable, and relevant. For example, instead of setting a vague goal like “increase sales,” a well-defined KPI would be “increase sales by 15% within the next quarter.” quarter”.

KPIs help employees focus on priorities and understand what results are expected of them. For management, it is a monitoring and evaluation tool that allows them to make timely adjustments to strategies and processes.

When used systematically, KPIs enhance transparency, improve performance tracking, and ensure all teams are aligned toward a common goal.

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