Lesson 11 Flashcards
(22 cards)
Why are success measures important in business?
They provide a clear picture of performance, support improvement, and help plan future objectives.
What are some common business success metrics?
Financial measures
Operational systems
Customer satisfaction
Employee performance
What are KPIs?
Measurable values that indicate how effectively business objectives are being achieved.
What do KPIs help businesses do?
Track effectiveness
Align goals
Set targets
Match talent to strategies
Measure time efficiency
What are the main categories of KPIs?
Financial
Operational
Employee
Customer
Who is responsible for KPIs?
Everyone—from top management to individual team members.
What do financial KPIs measure?
The strength of a business in terms of profit, revenue, and expenses.
Examples of financial KPIs?
Gross and net profit ratios
Liquidity (cash flow)
Revenue
Sales
Inventory turnover
Cost management
Debt management
Shareholder dividends
What do operational KPIs track?
Efficiency of daily business operations.
Examples of operational KPIs?
Productivity rates
Delivery times
Admin, IT, production, and customer service performance
Why are operational KPIs important?
They highlight underperforming areas for quick resolution.
Why are employee KPIs important?
They help retain talent and improve workplace culture.
Examples of employee KPIs?
Turnover rate (% leaving)
Engagement (% proactive)
Absenteeism (% absence)
Time to hire
Time to productivity for new hires
What do customer KPIs measure?
Satisfaction, loyalty, and retention.
Examples of customer KPIs?
First contact resolution
Satisfaction surveys
Retention rate
Net Promoter Score (NPS)
Churn rate
What are the key steps in setting KPIs?
Set objectives
Ask Key Performance Questions (KPQs)
Review current data
Collect supporting info
Set measurement frequency
Set short/long-term goals
Assign ownership
Share with stakeholders
What does SMARTER stand for in KPI-setting?
Specific
Measurable
Achievable
Relevant
Time-bound
Evaluative
Readjustable
What are KPQs?
Open-ended questions that guide the creation of KPIs.
Examples of KPQs?
How is progress defined?
Why is that result important?
How do I contribute to the outcome?
What results do we need?
How will I know if the goal is achieved?
What are the benefits of using KPIs?
Align priorities
Motivate staff
Drive performance
Enable benchmarking
Build accountability
Improve efficiency and effectiveness
What is KPI benchmarking?
Comparing a business’s KPIs with averages or standards in the same industry.
Why is KPI benchmarking useful?
It shows how the business performs relative to competitors and helps identify areas for improvement.
