Key Performance Indicator (KPI) Examples

I. Characteristics of KPI

KPI is a term specifically used to indicate criteria adopted in evaluating the employee’s performance. Following are some characteristics of KPI:

1. A KPI must be aligned with the organization’s objectives;

2. A KPI is determined by management personnel (normally human resource managers);

3. A KPI must be designed so that it is easy to understand;

4. Some KPIs are specifically designed for each employee;

5. KPIs are expected performance by the organization;

6. KPIs must be designed to balance the evaluation of each employee;

7. KPIs lose their accuracy over time; therefore, it is necessary to revise KPIs periodically.

II. Requirements of a KPI:

An effective KPI should be:

1. Specific;

2. Measureable;

3. Achievable;

4. Performance relevant;

5. Containing deadline requirement.

III. How to design a KPI?

1. Design Key Result Areas (KRAs) and the importance of each KRA;

2. Identify necessary procedures to perform each KRA;

3. Identify the measurement criteria for each KRA and evaluate the importance of each criterion;

4. Summarize the criteria and the importance of each criterion;

5. Develop a summary table of KPIs.

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