What exactly is a KPI report and how is it useful for your organization? In this blog, we break down the basics of what a KPI and KPI report is and provide you with 4 key steps to help you write an effective KPI report for your business.
A KPI, or Key Performance Indicator, is a quantifiable value that helps a company track its progress on meeting its objectives. Some examples of KPIs include website traffic, monthly sales, or brand awareness.
All KPIs are separated into two general types: (1) lagging KPIs and (2) leading KPIs. Lagging KPIs are the results from previous performance while leading KPIs are used to predict or influence future performance. It's vital to look at both of these to understand the progress your company is making.
KPI reports, or Key Performance Indicator reports, are essential to your business achieving its goals. They measure the relationship between a business' progress and the desired result.
In addition, they help companies understand whether and what practices need to be altered to better reach theirobjectives. KPI reports are typically presented as a graphs and charts that track a company's KPIs.
KPI reports are particularly useful in their ability to condense enormous amounts of data into key factors, which can save businesses time and allow them to adjust quickly to changes in the market. Moreover, KPI reports also help companies track the efficiency and effectiveness of established goals.
Once you've understood the basics of a KPI and a KPI report, the next step is writing one. Here are 4 key steps to follow when writing your KPI report:
4 Steps for Writing an Effective KPI Report
Clearly state the report's purpose. This gives context to anyone using the KPI report and allows them to properly interpret the data. When composing a clear objective for your KPI report, be sure that it answers these questions:
Once you've got your objective, you'll have a good idea about what information you need measured. Getting data for these KPIs can be tricky, though. Does it already exist? Is it reliable?
The data you need may already exist in old systems or reports, so it may take time to gather it all. This data – along with any new data that accumulates – will need to be gathered together regularly for reporting.
After you've gathered your data, create a prototype report. Make sure to choose charts or graphs that present the information in the simplest way. Keep the charts relevant and focused.
Then, share with stakeholders or colleagues in the company. Once you've received feedback, you can start to refine the report.
Consider the comments made on your first draft, making sure you're keeping the data as easy to comprehend as possible. Build in regular review periods; this will help keep the information accurate. You may need to adjust or replace your KPI reports as your goals evolve.
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