A key performance indicator (KPI) is a business metric, or measurable event, used to evaluate factors that are crucial to the success of an organization. KPIs differ in each organization. KPIs are a set of indicators to measure against. They are a gauge of an enterprise’s success. KPIs help an organization monitor and assess their progress toward defined goals in a specific work area or action.
KPIs are used in time and attendance systems to gauge business performance and trends. From these KPIs a business can then make key decisions for going forward.
KPIs require a predefined organizational process, clear business objectives for the process, quantitative and qualitative measurements and an active approach to finding and remedying enterprise variances.
Examples of KPIs are product production rates, net revenue, customer loyalty metrics, etc.