Using KPI Software to Simplify Business Decision Making
A Key Performance Indicator (KPI) is a measurement of performance of a certain function within a business. Key Performance Indicators can be both financial and non-financial measures which help an organization work towards its vision and organizational goals. They are quantitative measurements plotted against a time range and are mostly presented in graphs.
Key Performance Indicator (KPI) Software is a high-level project management system which integrates all business data across departments and business processes in a company. KPI software can analyze performance of each department in an organization consisting of reports, spreadsheets, charts and trends. The uses of KPIs vary for different organizations and different departments depending on its particular goal or mission. It can be designed for all the departments in an organization from marketing and sales to manufacturing and HR activities.
From a company management perspective, it helps analyzing company profits differentiated by regions, customer profiles and demographic analysis of customers. Using the software, a company’s HR department can keep track of the productivity, work quality, process flow and team performance of their employees. In manufacturing departments, the usual KPIs used are rate and volume of production, their performance, quality, etc. The Overall Equipment Effectiveness or OEE is often used as the standard set of metrics to gauge the performance of a manufacturing unit. For a customer support team, it provides insight into the queries received, solved, percentage of satisfied clients etc. Also, it comes in really handy in sales and marketing departments for measuring sales of a region, cost per download, cost per sale, cost per conversion, competitor analysis based on sales volumes etc.
KPIs can be categorized as follows:
Quantitative KPIs – These are measures that have a specific number or a financial value attached to them. Most often, they take the form of marketing or sales calculations.
Directional KPIs – Directional KPIs give a simple assessment of the statistics of a certain area of business operation. It is used to indicate company performance matrix over a period or to spot trends in the business cycle over a period of time.
Actionable KPIs – These KPIs are used when a definite step is needed to be taken based on the KPI itself. An example of a highly actionable KPI can be used to track landing page conversion rate or discussion forum monitoring, and then take the required steps to improve it.
Practical KPIs – These are those that are related to processes that are currently followed in the company. It can be tracking a work flow process of related departments or it can be the number of days one department takes to complete specific work activities.