A Key Performance Indicator (KPI) is a quantifiable metric that measures an organisation’s progress toward a defined strategic or operational objective. KPIs are selected because they are directly linked to outcomes that matter for the organisation, rather than simply measuring activity or output. A well-defined KPI has a clear target, a defined measurement method, a responsible owner, and a reporting frequency aligned to the pace of the decision it is designed to inform.
Why This Matters
KPIs are the primary mechanism through which organisations monitor whether they are on track to achieve their objectives. When KPIs are well-selected and clearly defined, they focus management attention on what matters most and provide the basis for performance conversations grounded in evidence. Poorly chosen KPIs — measuring the wrong outcomes, defined inconsistently, or without clear targets — generate reporting activity without decision-making value.
Where This Fits
This term sits within the Reporting area of Performance & Control.
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