Identifying relevant measures
What is a Key Performance Indicator?
A Key Performance Indicator (KPI) measures the organizations progress towards your Objectives. KPIs answer the question “How far along are we in this process?” These measures should reflect your organization’s meaningful change during this process and may be either qualitatively or quantitatively based.
What is a Metric?
A Metric measures the progress of the organization’s tangible steps towards completion of their Strategies. Metrics answer “How will we know this Strategy is complete?” Metrics are another measurement of change.
For examples of potential data sources at Penn State, you can follow this link: https://opair.psu.edu/institutional-research/.
KPIs and Metrics: Know the Difference
What are KPIs and Metrics?
Key Performance Indicators (KPIs) are checkpoints used to determine effective or successful progress toward an organization’s desired outcomes, evaluated over a specific timeframe and compared against past performance. A KPI is a measure of performance that focuses the organization’s attention on what matters most for success of their Objectives. Such measures are commonly used to help define and evaluate how successful it is, typically in terms of making progress towards its longer-term organization goals. They provide a way to see if your strategy is working and are used to determine if Objectives are met. KPIs are the measures that have the most impact in moving the organization towards reaching their Vision.
Metrics are the measures within the Strategy used to demonstrate specific performance or progress. They provide set of meaningful measures used to gauge or compare performance in terms of completing Strategies. These provide data on the organization’s processes but are not the most critical measures to indicate progress against the organization’s plan.
Both should be measurable — whether qualitative or quantitative — and stem from this question: “How will you know when your organization has successfully changed?” You should review your KPIs and metrics to determine whether your targets are outcome-based or effort-based. An outcome-based goal may involve elements which are outside the sphere of influence of your organization – while an effort-based goal focuses more on the actions your organization will take to try to achieve that target. For instance, a KPI of “double the size of Program Z” as a measure of success requires students to affirmatively choose to enroll – which is an independent decision. Creating and executing the processes which could lead to that doubling of enrollment might make for a more realistic goal.
How to write a good KPI or metric
- Determine the organization’s definition of a successful Objective or Strategy.
- Decide how you will measure this success or degree of change.
- Consider how to track and visualize this measurement.
- When writing the KPI or metric, keep it simple. With few exceptions, either should be a sentence or two structured to include an action, detail, value, measurement unit and/or deadline relevant to the Objective or Strategy.
What makes a meaningful KPI or metric?
- There should be clearly defined specific targets and milestones to verify performance or progress outcomes towards your Objective.
- Each must be valid and realistic, helping ensure we are measuring the right things.
- They generally include specific measures to gauge progress relevant to your Objective or Strategy from a defined qualitative or quantitative data source.
- They should be meaningful reflections of the change outlined in the organization’s plan, not just collecting data for the sake of reporting data. (For example: counting presentations only measures how many presentations were made, not the impact of them)
- They should be realistically attainable with a reasonable level of effort within the given timeframe.
- Each should have a “point” person or team assigned to monitor progress.
- Progress should be reviewed regularly and used as a tool to improve outcomes and make necessary “in-course corrections” to the plan.
- Each must be verifiable to ensure accurate data.