Key Performance Indicator (KPI)

Without a number, nobody can say whether the work is paying off, and arguments are settled by whoever speaks loudest. Three to five KPIs that truly drive the outcome also create alignment. A debate over a small tactical change gets shorter once everyone knows which number it is meant to move. Reviewing them on a fixed rhythm turns drift into an early warning, not a surprise at the end of the quarter.

• Start from the goal, then pick the number that shows progress towards it, not the number that is merely easy to pull.
• Check that the team's actions can actually move it. If they cannot, it is a report, not a KPI.
• Set a review rhythm: weekly for numbers influenced daily, monthly or quarterly for slower ones.
• Keep three to five core KPIs, plus a few diagnostic numbers that explain why the core ones move.
• Investigate the moment a KPI slips from target, without waiting for the next scheduled review.

A KPI turns a vague goal into a number a team can move. "Grow faster" is hard to act on. "Raise new recurring revenue from 20,000 to 30,000 euros a quarter" is not. A KPI has a definition everyone agrees on, a target, a time frame and one person who answers for it. Plenty of numbers are worth reporting. Only a few earn the label, because they tie directly to a goal.

• Tracking dozens of KPIs, which means none gets attention.
• Rewarding a KPI so hard that people game it, a risk summed up by Goodhart's law: once a measure becomes a target, it stops being a good measure.
• Confusing a KPI with a goal. The goal is the outcome. The KPI is how progress is read.