Key Performance Indicators - KPI
Categories: Metrics, Company Management
Companies are in business to make money. That’s literally the bottom line: how much cash the firm can rack up by doing its business.
However, measuring money isn’t always the most direct way to see how well the company performs its specific business.
Enter: key performance indicators. These figures represent quantifiable stats related to a particular business.
If you’re a farmer, you might look at yield per acre. How much profit you make from your farm will depend on market prices for your crop...something you have little (if any) control over.
But you do have control over your output. You can work to maximize your yield per acre, so tracking that is a more impactful way of optimizing your business than looking at pure profit. It’s a key performance indicator for your farm.