What are key performance indicators (KPIs) used for in organizations?

Key performance indicators (KPIs) serve as measurable values that demonstrate how effectively an organization is achieving its key business objectives. By tracking KPIs, businesses can gain insights into their performance across various aspects, such as financial health, customer satisfaction, operational efficiency, and market growth. This allows organizations to assess progress towards strategic goals and make informed decisions based on data.

KPIs are not limited to employee performance alone, as they encompass a broader spectrum of organizational outcomes and objectives. Their primary purpose is to provide a clear framework for measuring success and targeting areas for improvement, ultimately aligning day-to-day operations with long-term strategic goals. Therefore, using KPIs to illustrate the achievement of business objectives is crucial for overall organizational performance.