finance
KPI (Key Performance Indicator)
A metric that, if it moves, signals success or failure of a strategic objective.
Definition
A KPI is not just any metric - it is THE metric that anchors to a strategic outcome. Most businesses track too many metrics and too few KPIs. The discipline: pick 3-5 KPIs that, if you hit them, mean the strategy worked. For a service business those might be: MRR, gross margin, lead-to-customer conversion, NPS, owner hours per week. Tracking 30 metrics dilutes attention; 3-5 KPIs focus it.
In your business
- →Pick 3-5 KPIs that anchor to your strategic plan
- →Review weekly - rolling 4-week trend matters more than single weeks
- →Don't add a new KPI without removing one