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To successfully achieve its goals an organization must follow certain rules and take some necessary measures. These measures are the KPI namely Key Performance Indicators, also termed as Key Success Indicators. When an organization is up to achieving its goals it becomes very important to set some indicators to analyze the process of performance. In this regard, KPI definition is a metric, not a target and KPI examples are often expressed as percentage which allows data to be tracked from time to time. Targets are expressed as objectives and can be included in the rate of performance too. KPI definition explains these as being business objectives with high level aims which are measurable, result oriented and quantifiable. Their objective translates into a KPI that enables the organization to measure a section of the process against a defined target. If a company’s KPI is "Increased Customer Satisfaction", that indicator will be focused differently in various departments. While the manufacturing section may have an indicator of "Number of Units Rejected by Quality Inspection", KPI examples for sales will be "Minutes a Customer Is on Hold before a Sales Rep Answers". Success experienced by sales and manufacturing departments in meeting their respective indicators will help the company meet its overall Key Performance Indicator. KPI examples according to KPI definition are metrics of various types like sales, marketing, supply chain and so on. There are many more examples and most of them pertain to the field wherein the human element plays a crucial role in determining the performance of the organization. According to the KPI definition KPI metrics are understood and arranged to get the best results. For sales, indicators are measured on a quarterly, daily, hourly, monthly, weekly and annual basis. Average figures especially pertaining to order size, sometimes called average market basket, margin and conversion rate are also taken into account. To check return on investment indicators like rate of abandonment of shopping cart and ratio of new customer orders versus old customer are checked. KPI definition also includes study of product knowledge like its affinity, relationship and inventory levels. Marketing KPI examples differ completely from those of sales. To find objective ways of quantifying subjective marketing data and determining what really creates leads and sales certain rules are followed. In this regard marketing metrics pertaining to a particular website use its each and every aspect like time spent on site, total traffic, types of visitors and so on. These KPI examples may seem complicated in the beginning but when grasped their benefits can be truly felt by any business. Even the KPI definition requires understanding but the results accrued over a period of time justify the time and effort spent in understanding it. Another noteworthy KPI example is supply chain metrics. In this the user needs to track the status of shipments, monitor the inventory to sales ratio, and know which items are currently out of stock. With the right supply chain KPIs, this information will be readily available and one can ensure that the warehouse inventory operations are running smoothly. Metrics that need to be monitored entail keeping an eye on inventory turnover and accuracy, perfect order and back order rate, status of the order, percentage of out of stock items and inventory to sales ratio all of which justify KPI definition. Understanding KPI definition is crucial to any contemporary business irrespective of the field in which it is operating. One of the ways that can render it easy entails following appropriate KPI examples so that similar model can be applied to the business.
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