Startup

Key Performance Indicators (KPIs), the Compass of Business

userimage

Waveon Team

0 min read

TABLE OF CONTENTS

Establishing goals and plans is the top priority when starting anything. Even when starting a diet, we set a goal to lose a certain amount of weight. In business, a commonly used term for company or project goals is KPI. The term KPI is used in every department, from HR to marketing, planning, and development. What is KPI, and how can it be applied to business?

What is KPI?

kpi

KPI stands for Key Performance Indicator, which can be translated as 'core performance indicator.' KPI refers to a measure that allows for the objective evaluation of the performance needed to achieve the most important goals. In other words, it is an indicator that measures the performance of factors with a high contribution to achieving an individual's or organization's strategic goals.

KPIs must be able to clearly understand the contribution and impact of the objectives and should be objective, quantifiable goals that can be measured. For example, if an individual's most important goal is to 'become a healthy, standard weight body,' the KPI for this could be 'lose 20 kg within a year.' In the case of business, to provide effective service that solves the target's problem, you can set a KPI like 'increase NPS (Net Promoter Score) by 2 points.'

Types of KPIs and How to Use KPI Concepts

The reason for using KPIs is that after setting a destination as the most important goal, you need a business compass to guide you to the destination while also checking your current position. To effectively use KPIs, it is a good idea to use the well-known SMART goal-setting method.

- Specific: Set specific goals related to the work being performed by the team.

- Measurable: Set objective and quantitative means to clearly judge success and failure.

- Achievable: Do not set goals beyond the achievable range, but also avoid goals that are too easy to achieve.

- Realistic: Set realistic goals in resource management, etc. (Ex. 'All team members work 80 hours a week for 3 months' may be achievable but is not realistic.)

- Time-bound: Set a clear end date.

kpi

When setting KPIs, it is important to set output indicators (Output KPIs) that can be directly verified as performance, but it is also important to set input indicators (Input KPIs) that tell you how much and where to invest.

- Output KPI: This is the primary result of business activities, such as sales, MAU, new subscribers, and monthly transaction volume, which indicate what has been produced and accomplished through the process of conducting business.

- Input KPI: These are indicators that guide the team's immediate actions to derive Output KPIs. For example, if the Output KPI of a community business is 'a certain number of MAUs,' you can take the necessary actions by setting input KPIs such as 'a certain number of posts written per day' and 'a certain number of comments per post.'

Setting and managing effective KPIs can determine the success or failure of a business. It's not about doing a lot of work but considering what work should be done for what purpose and reflecting on it. Moreover, setting KPIs is important, but measuring KPIs after conducting business based on them is also crucial. Data analysis becomes an important skill. With all the preparations in place, the business can further develop through the appropriate use of KPIs.

Curious about more articles? ⇒ Visit https://www.waveon.io/blog

Learn more about No-code insights

Subscribe Waveon Newsletter

*Type your email address

Waveon Banner Image

Other articles

What is Landing Page Automation and How does it work?
Startup

What is Landing Page Automation and How does it work?

If there’s anything that keeps enterprises operational while producing greatrevenue, it’s automation. They have integrated it into the core, everywhere fromonboarding to accounting.So, what can small-to-mid businesses learn fromindustry giants? Integrating automation into the core of your business. Sinceautomation isn’t going anywhere — the best you can do is to reap its benefits.That starts

Startup's Milestone
Startup

Startup's Milestone

Startups often have limited resources, such as manpower, so it is crucial to usethese limited resources efficiently to achieve good results. To do this,efficient project management is necessary. If the major goals of the businessare set as KPIs (Key Performance Indicators), then there are smaller projectsneeded to achieve these KPIs, and metrics or concepts are required to managethem. This is

What is "Demo day"?
Startup

What is "Demo day"?

What comes to mind when you think of the atmosphere of a startup? You mightpicture a hackathon with free-spirited and passionate individuals gathering tohave heated discussions about business, or a flexible work environment wherepeople dress casually and work efficiently. Among these, today we will learnabout the "flower" of startups, the Demo Day. What is Demo Day? Demo Day is anevent where

What is "Pivot"?
Startup

What is "Pivot"?

If you are involved in startups, you may have heard about Eric Ries' "LeanStartup" at least once. Our company, Waveon, is also trying to practice theconcept of Lean Startup. The term "lean" means "without fat", which implies nowaste. In this context, a lean startup is a methodology for startups thatrecommends eliminating unnecessary elements, quickly testing products, andmoving agilely. Eric

Key Performance Indicators (KPIs), the Compass of Business
Startup

Key Performance Indicators (KPIs), the Compass of Business

Establishing goals and plans is the top priority when starting anything. Evenwhen starting a diet, we set a goal to lose a certain amount of weight. Inbusiness, a commonly used term for company or project goals is KPI. The term KPIis used in every department, from HR to marketing, planning, and development.What is KPI, and how can it be applied to business? What is KPI? KPI stands forKey Perf

Preventing Flawed MVP Development in Startups - The Mom Test
Startup

Preventing Flawed MVP Development in Startups - The Mom Test

Recently, various hypothesis testing methodologies such as MVP, prototypes,pre-prototypes, and lean startups have been employed in startups to developfail-proof products. However, when you try these processes yourself, you'll findthat they require more resources and time than you might think. Is there a wayto reduce even the resources involved in hypothesis testing? In this article, weintrodu

Bubble.io - Complete review of the No Code Tool
Startup

Bubble.io - Complete review of the No Code Tool

No-code tools are revolutionizing the way software is built and developed. Withno-code tools, you can create fully functional web applications without anyknowledge of coding! These tools offer many advantages in terms of speed,cost-effectiveness, and accessibility, making them an attractive choice forstartups, small businesses, and individuals. About Bubble One of the mostpopular no-code tool

Learn more about No-code insights

Subscribe Waveon Newsletter

*Type your email address