Future Internet PPP Use Case Project

Future Internet PPP

FInest Domain Dictionary

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Key Performance Indicators

A performance Indicator or Key Performance Indicator (KPI) is a term used for a type of measure of performance. KPIs are commonly used by an organization to evaluate its success or the success of a particular activity in which it is engaged. Sometimes success is defined in terms of making progress toward strategic goals, but often success is simply the repeated achievement of some level of operational goal (zero defects, 10/10 customer satisfaction etc.). Accordingly, choosing the right KPIs is dependent upon having a good understanding of what is important to the organization. 'What is important' often depends on the group measuring the performance - the KPIs useful to a finance team will be quite different to the KPIs assigned to the supply chain team, for example. Because of the need to develop a good understanding of what is important, performance indicator selection is often closely associated with the use of various techniques to assess the present state of the business and its key activities.

Indicators identifiable as possible candidates for KPIs can be summarized into the following sub-categories:

- Quantitative indicators which can be presented as a number;
- Practical indicators that interface with existing company processes;
- Directional indicators specifying whether an organization is getting better or not;
- Actionable indicators that are sufficiently in an organization's control to effect change;
- Financial indicators used in performance measurement and when looking at an operating index.

Key Performance Indicators, in practical terms and for strategic development, are objectives to be targeted that will add the most value to a business.

See KPIs in Transport and Logistics

Last change: 2011-11-14

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