What is the full form of KPI

KPI: Key Performance Indicator

KPI stands for Key Performance Indicator. A Key Performance Indicator is a measurable value that demonstrates how effectively a company is achieving key business objectives. Organizations use KPIs at multiple levels to evaluate their success at reaching targets. High-level KPIs may focus on the overall performance of the business, while low-level KPIs may focus on processes in departments such as sales, marketing, HR, support and others.

The relative business intelligence value of a set of measurements is greatly improved when the organization understands how various metrics are used and how different types of measures contribute to the picture of how the organization is doing. KPIs can be categorized into several different types:

Inputs measure attributes (amount, type, quality) of resources consumed in processes that produce outputs
Process or activity measures focus on how the efficiency, quality, or consistency of specific processes used to produce a specific output; they can also measure controls on that process, such as the tools/equipment used or process training
Outputs are result measures that indicate how much work is done and define what is produced
Outcomes focus on accomplishments or impacts, and are classified as Intermediate Outcomes, such as customer brand awareness (a direct result of, say, marketing or communications outputs), or End Outcomes, such as customer retention or sales (that are driven by the increased brand awareness)
Project measures answer questions about the status of deliverables and milestone progress related to important projects or initiatives

Examples of Sales KPIs

Number of New Contracts Signed Per Period
Dollar Value for New Contracts Signed Per Period
Number of Engaged Qualified Leads in Sales Funnel
Hours of Resources Spent on Sales Follow Up
Average Time for Conversion
Net Sales – Dollar or Percentage Growth

Examples of Financial KPIs

Growth in Revenue
Net Profit Margin
Gross Profit Margin
Operational Cash Flow
Current Accounts Receivables
Inventory Turnover