Key performance indicators (KPIs) are used to measure the business performance in terms of success achieved in meeting business goals. KPIs consider all the products, services, business growth, and new opportunities. For the same reason, a business should have a limited number of KPIs. Because if we start quantifying each and every aspect of business, it will misguide us.
KPIs are used to understand your company's performance and health better, allowing you to make important improvements to your execution to meet your strategic objectives. You will get better productivity and results once you fix the appropriate KPIs. Let us find what steps can be taken to choose the right KPIs for your business to record its growth.
Steps To Choose Right KPIs For Business
There are many ways to choose the KPIs, and different companies choose them differently. Here, we will discuss the major steps to identify correct KPIs for a business:
Have a specific business objective.
KPIs are used to track the progress of a business. So, you should have a clear idea of what you want to achieve. In short, define your business goals so that you can measure those and convert them into numbers. For instance, you can fix your goal to increase sales by 10% in the next three months or profits by 5% in the next six months, etc. It also goes with a simple saying that you can get even an impossible thing if you are determined when you have practical aims to convert, KPIs help to measure those to let you know that you are working in the right direction. When you tell your SEO team to aim for something practical by specifying a number, they will also give their best to increase productivity.
Use ratios and ranges.
You can also fix some ratios or ranges to chase to simplify things more. For example, if you have launched a new product, you can target your sales and marketing team to sell 500 items in a week or two. While you can't guarantee that goal will be met, at least you've drawn a line as you can track your progress. If the target is beyond the expectations, you can change it anytime.
Avoid vanity metrics.
Never consider the vanity metrics that look valuable to quantify but aren't valuable in measuring progress. For Instance, if you have an application, thousands of downloads of only the free version will not serve any purpose, and it will only give us hope of success as satisfying us in terms that it is useful for others.
Use quantitative and qualitative KPIs.
Quantitative indicators, such as monthly active users and the number of downloads, measure the quantity, not the quality of a product or application. This offers the advantage of representing results statistically. You should know which KPI will track which business components. Reviews are counted into qualitative indicators, and they let you know how a product or service is performing and what users think of it. You should include both the measurable and qualitative indicators for better performance.
Observe the trends.
Analyze the result statistics of your company over different periods and the rivals. For instance, businesses can analyze sales and profits obtained over a week. This allows you to see patterns in which period they increase or decrease. Accordingly, you can change your market strategy. If a product is not giving a positive response at all, you can drop it.
Make certain that the KPIs you choose are attainable.
It's pointless to choose a KPI for your company if the data underlying it can't be gathered and presented to stakeholders. When weighing the cost/benefit of a given KPI, you can make calculations based on the data points, complexity and cost of processes and technologies involved, advantages we can gain, etc.
Keep your KPIs prominent and monitor your progress regularly.
Unfortunately, many people go through the time-consuming process of fixing KPIs and then take them for granted until seeking results. This is completely wrong. You should keep a check on selected KPIs and continuously track them in the form of a live KPI dashboard. You should also schedule regular checkpoints to assess your progress. This provides an opportunity to consider what has worked in the past and what you could be edited or introduced to improve.
Wrapping Up
As discussed above, you would learn what KPIs are and how to fix the right ones according to your business. Fixing the operational, organizational, and financial KPIs is essential to track the business health and growth, change the planning and targets from time to time, identify the issues, give solutions, and analyze trends to improve efficiency. All in all, KPIs should align with different growth stages, and business goals should be measurable, attainable, and actionable. Hope this post helps you in selecting suitable KPIs. But in any case, if you feel stuck, you can contact SEO professionals.
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