---
title: "What Is a Key Performance Indicator (KPI)? Examples"
url: https://www.wisemonk.io/glossary/what-is-a-key-performance-indicator-kpi
lang: en
---

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# What is a Key Performance Indicator (KPI)?

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**A Key Performance Indicator (KPI) is a measurable value that shows how effectively an individual, team, or company is achieving its most important business objectives.** Good KPIs are quantifiable, tied to a clear goal, reviewed regularly, and within the team's ability to influence. They sit at the heart of performance management, executive dashboards, and individual reviews, and translate strategy into a small number of metrics everyone can act on. The wrong KPIs are worse than none, because they reward the wrong behaviour at scale.

## What makes a good KPI?

Across functions and industries, well-designed KPIs share five qualities.

- **Specific:** the metric points to one clearly defined thing, not a fuzzy outcome.
- **Measurable:** the value can be captured reliably from a known data source, not estimated by feel.
- **Tied to a business outcome:** improving the KPI moves something the company actually cares about, not just an internal score.
- **Time-bound:** the target is fixed against a specific period, such as a quarter, year, or campaign.
- **Within the team's influence:** the people held accountable can actually move the number through their work.

## Types of KPIs

- **Leading vs lagging:** leading KPIs predict future outcomes (pipeline coverage, MQLs); lagging KPIs measure the result after the fact (revenue, churn).
- **Strategic vs operational:** strategic KPIs sit on the board dashboard and track the big bets; operational KPIs run team workflows day-to-day.
- **Quantitative vs qualitative:** quantitative KPIs use direct numbers; qualitative KPIs convert judgement (NPS, eNPS) into a numeric score.

## KPI examples by function

| Function | Common KPIs |
| --- | --- |
| Sales | Pipeline coverage, win rate, CAC, quota attainment |
| Marketing | MQLs, CPL, organic traffic, ROAS |
| Customer Success | Net Revenue Retention, NPS, churn rate, time to value |
| Human Resources | Attrition rate, time-to-hire, offer acceptance, eNPS |
| Engineering | Cycle time, deploy frequency, change failure rate, MTTR |
| Finance | Gross margin, DSO, burn rate, runway |

## KPI vs OKR vs metric

These three terms get used interchangeably, but they describe different things in performance management.

- **Metric:** any quantified measurement of something, with or without a target attached.
- **KPI:** a metric chosen as a key signal of performance against a goal, with a target and a review cadence.
- **OKR:** a goal-setting framework (Objective + Key Results) that uses metrics as its key results but is broader than any single KPI.

The biggest mistake with KPIs is having too many. Five well-chosen KPIs per team beats twenty that nobody can recite. The point is focus, not coverage.

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