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:
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.