KPIs: What you need to know
Keep getting questioned about your KPIs?
Being able to demonstrate you’ve hit your KPIs in your previous or current job could be the key to finding your next perfect position. Not a fan of acronyms? We’ve got you covered.
Here’s a quick guide to understanding KPIs:
What does KPI stand for?
KPI stands for Key Performance Indicators.
They are measurable goals set by your employers which help track your progress in a particular position.
As well as matching your personal progress, KPIs should always align with and reflect the business’ goals.
How do they work?
KPIs work as measures for one main reason – they are quantifiable.
Rather than being set a fairly generic task which may be hard to define and justify, such as ‘Increase sales’, your Key Performance Indicators will set you measurable targets to aim for.
These targets can then be monitored throughout the year, presenting areas in which you can improve and allowing the business to see how they can support you more effectively.
What’s more, KPIs can be extremely useful at demonstrating your previous success stories – something which can really help when it comes to applying for a new job.
A typical KPI will follow the SMART formula, meaning that each one is:
S – Specific
M – Measurable
A – Achievable
R – Relevant
T – Time-bound
Types of KPI
The way KPIs are used will vary depending on the industry you’re in. Here are a few factors key performance indicators are often based on:
- Business indexes. Keeping an index of business activity (whether it’s sales leads or production errors) allows businesses to create and measure accurate KPIs.
- ROI (Return on Investment). Commonly used to measure the profits of marketing activity, calculating ROI lets businesses know how effective their work is.
- Financial indicators. If you work in commercial business, you might find that KPIs are informed by things like sales figures and turnover.
- Customer retention. Although this KPI is found in many industries – it’s most commonly used in the retail sector, where attracting and retaining customers is key.
- Satisfaction metrics. These metrics can be a great way to measure customer experience, without relying on financial figures.
- Call times. This is a common KPI in the sales industry, as well as any other sector where effective client interaction is a priority.
When can KPIs be a problem?
If set correctly, your KPIs should be achievable and quantifiable targets to aim for. However, if your targets aren’t properly defined, they can become problematic.
Without putting a value against each one, there is no way of accurately keeping track of your progress.
Additionally, even if there are proper benchmarks set against each area, if they’re set too high or seem unachievable, KPIs risk demotivating an employee before they really get a chance to shine.
How do you demonstrate KPIs in your CV?
Throughout your CV, your KPIs can be used to make the most of your achievements.
Whether it’s in your ‘Key Skills’ section, or demonstrating your successes during previous periods of employment, including your previous KPIs and how you hit them will be much more effective than simply outlining your previous duties.
To learn more about how to include your achievements in your CV, read our CV advice before downloading our free CV template.
KPI examples
OK, so KPIs sound great – but how do they actually sound when it comes to your application?
Good examples of demonstrating your KPIs include:
- Increasing overall sales revenue by X%
- X number of new clients won for the year
- Cutting costs by X%
- Decreasing customer turnover rate by X%
- Dealing with X customer enquiries within a specific timeframe
- Having X% of students attain an A-C grade in their exams
These are just a few examples of how KPIs can be set out by the business and, in turn, used to your advantage when it comes to you application.
However, this is by no means an extensive list, and your own targets should always relate directly both to your role and to the organisation goals of the company you work for.
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