KPI is a term that has the power to instil a feeling of motivation or dread into businesses and their employees depending on past experience. However, KPI development is a process you can’t ignore as a manager or business owner.
Commonly used in sales settings, KPIs actually have multiple benefits when used effectively in all areas of a business, and can shine a light on areas of your company that require attention and support.
In this KPI development guide, we’ll highlight how KPIs can supercharge productivity and enhance motivation when used effectively. We’ll also explain why you should be using them to support your business growth.
What is KPI development?
KPI development is essentially the art of crafting effective KPIs for your teams. Many businesses make the mistake of oversimplifying their KPIs in the form of exclusively numerical targets – but when we get sophisticated and specific with our KPIs, that’s when we can unlock the power of their full potential.
Good KPI development involves assessing which measurable values mean the most to your company and your progress moving forward, and how you can use certain KPIs at different levels to drive and evaluate overall performance and success.
KPI development can be split into several categories – some focused on the upper levels of the business and overarching company goals, with others focused on individual teams and departments like sales, marketing and HR.
How to develop KPIs for your business goals
KPI development can feel daunting, especially when you have multiple areas you want to employ them within. Some tips include:
- Get clear on your main organisational goals, then work from there: Clarity really is key when it comes to successful KPI development. Get specific on the business outcomes and objectives you want KPIs to support and how each KPI relates back to them.
- Make sure your KPIs are truly quantifiable: KPIs by nature are measurable and quantifiable. Be sure to check this when developing them, taking care to also determine which tools you may need to accurately measure your progress.
- Split up KPIs into groups that make sense: KPI development in itself needs an organised, structured approach to be successful. One of the most effective ways to deliver KPIs is splitting them into relevant groups or sectors within your company.
- Schedule regular reviews: KPIs should be malleable and adaptable. They may not stay the same over extended periods of time – in fact, many shouldn’t. KPIs should move as you do, reflecting the progress you make at each stage of your business growth. Schedule regular check-ups and be prepared to make changes.
Tools to help with KPI development
It’s best to approach the KPI development process with prior knowledge and support. Fortunately, there are plenty of tools out there to support the successful creation and implementation of KPIs for businesses.
- Guides and templates: There is a variety of KPI development template resources and guides out there you can use to get a better idea of how KPIs work and what steps you need to take to implement them effectively within your business. Like any skill though, reading and learning the ins and outs of KPI development takes time, so it’s worth considering whether your resources are better spent elsewhere. If so, outsourcing is an option.
- OKR examples: Checking out some examples of OKRs and KPIs can really help to get those creative juices going and enable you to see more clearly how they could fit within your business. Just be sure not to ‘copy and paste’ others’ KPIs without spending time really targeting them to your unique objectives and goals.
- Software and apps: There are a number of software and apps available that promise to make KPI development and implementation easier and better organised. Be careful with this one – whilst we love tools and technology, some are expensive, and it’s worth taking a look at testimonials and establishing how easy they are to set up and use to determine which are worth exploring for your company.
How can we help?
At TBG we live and breathe OKRs and KPIs – because we know how influential and beneficial they can be for businesses of all shapes and sizes. Our passion is enabling the businesses we work with to efficiently implement OKRs that offer real results whilst also enhancing efficiency, helping steer your company in the desired direction.
For tailored, friendly support and expert guidance on KPI development, speak with one of our Giants today.