HR glossary / K / Key Performance Indicators (KPI)

Key Performance Indicators (KPI)


Key Performance Indicators (KPIs) are specifically defined metrics that allow organizations to measure progress toward business objectives. KPIs are a managerial tool used to monitor, analyze, and enhance the efficiency of various activities within an organization.

Choosing the right KPIs is crucial for an organization’s success, as it enables focus on what truly matters for the execution of business strategy. These indicators are typically specific, measurable, and time-bound, allowing for consistent tracking of progress and adjustments in actions.

In the context of HR, KPIs often focus on aspects such as recruitment process efficiency, employee engagement, training effectiveness, or employee turnover. By measuring and analyzing these indicators, the HR department can better understand which actions yield the desired results and where there are areas for improvement.


Why are KPIs so important?

KPIs help organizations focus on crucial aspects of their operations, measure progress, and make necessary adjustments to their actions.

While some KPIs can be applied across various organizations, it’s best to tailor them specifically to the unique characteristics and objectives of a particular company.

This depends on the nature of the indicator and the dynamics of the company’s operations, but frequently, analysis occurs monthly, quarterly, or annually.


Employee performance tracking

Monitors individual employee achievements and aligns them with organizational goals.

Organizational health analysis

Assesses the overall effectiveness of the company in achieving key business objectives.

Customer satisfaction measurement

Evaluates how well the company is delivering products or services to its customers.

Process improvement initiatives

Identifies efficiency metrics for business processes that need optimization.

Financial performance assessment

Tracks financial KPIs like ROI, cost per hire, revenue per employee, which are critical for measuring the financial health of the organization.

Wypróbuj HRnest za darmo

Zarejstruj się i testuj nasz system przez 30 dni bez zobowiązań!

HR glossary / K / Key Performance Indicators (KPI)

Try out HRnest for free

Sign up and test our system for 14 days with no obligation!

Related articles

List of key terms and information related to the issue

See also