Curious about KPI reporting and how it can help your business?
A KPI report will help you analyze how well your business is performing over key business goals and objectives. Whenever you need an update about how well things are going, just consult your KPI report for the information you need!
What goes into KPI reporting?
And more importantly, how do you set it up for your business?
We’ll answer those questions in this article and even highlight the perfect tool to solve all your KPI reporting needs.
And since KPI reporting is so essential to running a successful business, why not take the help of the owners of a successful pub in the show “It’s Always Sunny In Philadelphia?”
Okay… maybe semi-successful is more appropriate whenever you’re talking about The Gang.
This Article Contains:
(click on the links to jump to a specific section)
- What are KPIs?
- What is a KPI report?
- What’s the right KPI for your report?
- How to start tracking KPIs in 4 simple steps
- The best KPI reporting tool for 2020
Let’s go – bottoms up!
What are KPIs?
Before we can get into KPI reporting, we need to first go over what KPIs are.
Since KPI reports track your KPI performance, you need to know what you’re tracking in the first place!
But if you would rather skip to the KPI report section right away, click here to jump there directly.
So what is a KPI?
A key performance indicator (KPI) is a quantifiable measure that helps you analyze your company’s performance over key business goals and objectives.
There are two important things to note here:
- An effective KPI must be quantifiable, i.e, they need to be metrics that you can easily measure
- An effective KPI only tracks your company’s performance over key business goals. If you’re using a metric to track a non-core business goal, then it’s not a key indicator
Here’s an example:
If the Gang from It’s Always Sunny wanted to increase revenue, they could use an effective KPI like “number of beers sold” as a measure.
Why is “number of beers sold” a good indicator?
- It’s closely tied to their key goal of increasing revenue
- It’s easily measurable
What’s the difference between a KPIs and business metric?
While KPIs and business metrics seem similar, there’s one key difference.
Here’s how you distinguish between KPIs and business metrics:
- If a metric tracks your performance over a key business goal, it’s a key performance indicator
- If a metric tracks your performance over any (core/non-core) business goal, it’s a business metric
Think of KPIs as a subset of business metrics that only focuses on what matters most to your business.
So if The Gang’s key goal was increasing revenue, a core performance indicator would be something like “total sales” while something like “turnover rate” would simply be a business metric.
How do KPIs and objectives differ?
A lot of people confuse KPIs with objectives because of how closely they’re related. But it’s important to note that they’re not the same thing:
- An objective is something that you’re looking to achieve in order to meet a specific goal
- A KPI is a performance measure you use to determine how well you’re doing in achieving your objective
Let’s use the same It’s Always Sunny example here:
If their goal was to increase revenue, they could aim to increase sales by 20%.
Here, “increasing sales by 20%” is an objective that they need to achieve to meet their goal. The key metric they use to measure this is “total sales.”
What is a KPI Report?
Now that you know what KPIs are, we can get into the reports you use to monitor them.
A KPI report is a physical or digital file that compiles performance data over all the KPIs you’re currently tracking. It’s essentially the place where all your KPI data is consolidated – making it easier for you to make sense of it all.
A good KPI tab will help you:
- Identify performance indicator trends and patterns
- Identify bottlenecks and issues
- Access detailed insights and performance data to make business decisions
It’s going to give you all the reporting data you need to feel like this:
Note: A KPI report is not a KPI template. A KPI template simply contains placeholders for your KPI data while a KPI report actually breaks down the data for you.
What are the different kinds of KPI reports?
Most business KPI reports are incredibly comprehensive and are capable of handling all kinds of performance data.
However, there are still three distinct types of reports that you use for different purposes:
A. Operational reports
Operational reports focus on your actual performance over the day-to-day operations of your business. The data in operational reports is monitored on a regular basis to evaluate your actual performance over daily, repetitive activities, and objectives.
Example: Sales (Monthly, quarterly or annual)
The Gang can use this to track their daily Rum Ham sales to see if it’s as a big a success as they hoped it’d be:
B. Analytical reports
These reports are focused on giving you detailed analytical insights about your key metric performance. They usually highlight performance indicator trends to analyze if you’re moving in the right direction.
Examples: Y-oY (year on year) seasonal sales growth, or quarterly sales growth.
A better example, The Gang can analyze how much money they bring in over different seasons to determine their most profitable months:
C. Strategic reports
Strategic reports focus on giving you detailed insights over the current status of your business and where things are heading. Decision makers use these reports for an actionable insight over their further growth.
Example: Percentage of Sales from a specific product, or from a specific region.
This can help your company decide where to ramp up marketing activities in a specific region, or for a specific product.
Given The Gang’s complicated relationship with money and their poor customer satisfaction levels, we’re pretty sure their strategic reports aren’t going to be thrilling!
How does a report and dashboard differ?
While a KPI report and dashboard is closely linked, there is one slight difference:
- KPI dashboards are usually used to visualize your KPI data to give you quick summations of where things are
- KPI reports are usually used to break down your KPI data in detail to analyze your actual performance
We’re glad you do Frank!
Note: Most modern KPI software comes with detailed analytics and dashboards – making them the perfect all-in-one solution.
What’s the Right KPI for Your Report?
You now know what key performance indicator reporting is.
But what’s the right KPI to track?
What are the “magic metrics” that will help you monitor everything that matters to you?
Well…that largely depends on you.
Remember, KPIs are metrics that track your company’s performance over your core business goals and objectives. And as different businesses have different core goals, the KPI metrics they track are going to vary.
For example, we know The Gang at Paddy’s Pub isn’t normal by any measure. So it makes sense to assume that what’s important to them is not going to be important to anyone else!
But that isn’t the only factor here.
Even if two businesses track the same core business goal, they could use two totally different KPI metrics to track their performance!
Paddy’s Pub could use a KPI example like “total sales” to track how well they’re bringing in more revenue while another pub could use a KPI example like “sales growth” instead.
But don’t worry, we’re not going to leave you hanging with just that.
Here’s a list of meaningful KPIs that most businesses track.
Go through these multiple KPIs to identify a KPI example that resonates with your business goals:
The Gang’s always on the lookout for interesting ways to make money, right?
And one of the more “normal” ways they can do that is by increasing sales at their pub.
Here are some meaningful KPIs to track their sales performance:
- Total sales revenue: total revenue generated from your products/business offerings over a defined period
- Cost of customer acquisition: this sales KPI calculates the total cost of acquiring a customer (includes the costs spent on the sales process and your marketing efforts)
- Sales growth: this sales KPI measures the percentage of growth in sales revenue over a specific period
- Lead to client conversion rate: percentage of leads your sales manager and representatives converted during your sales cycle
Paddy’s Pub isn’t the most popular pub in Philadelphia, right?
That’s why it probably needs some marketing efforts like this ad campaign:
But will The Gang know if their marketing efforts are working?
They can track marketing metrics like:
- Social media KPIs: KPI metrics covering social media such as likes, shares, comments, etc
- Marketing ROI: a marketing KPI to calculate total return on investment generated from all your marketing channels like AdWords, SEO, influencer marketing, and so on
- Bounce rate: percentage of website visitors who left your website within just a few seconds after landing
- MQL to SQL ratio: ratio of marketing qualified leads moved to the sales funnel
The Gang doesn’t have the best business intelligence when it comes to money:
Which is why it’s a good idea for them to carefully monitor these financial KPIs:
- Profit margin: ratio of profit divided by the total revenue before or after tax (as specified)
- Free cash flow: amount of money you have left after your capital expenditures
- Debt to equity ratio: ratio of your company’s total liabilities against your shareholder equity
- Quick ratio: ratio used to determine a company’s liquidity based on current assets/current liabilities
HR (Human Resource) KPIs
We’re pretty sure nobody’s going to want to work for The Gang.
Because, well, who would?!
Even they agree!
However, in case they did get some staff, these meaningful KPIs would come in handy:
- Revenue per employee: total revenue divided by total employees
- Employee turnover rate: percentage of employees who left against your total employees
- Cost per hire: total cost of hiring each employee (includes expenses on hiring, training and onboarding them)
- Absenteeism rate: percentage of employees who were absent over a given time period
If you’re looking for more KPI examples, click here.
How to Start Tracking KPIs in 4 Simple Steps
Now that we’ve covered the basics of business KPI reporting, let’s get into the process of how you can start tracking KPIs:
Step 1: Define your key business goals
Remember, KPIs track your performance over core business goals and objectives.
If you don’t have a key business goal in place, your KPIs aren’t going to have anything to measure!
That’s why the first step is to clearly identify what your key business goals are.
For example, increasing the revenue that Paddy’s Pub brings in would be a good core business goal for its key stakeholders, right?
Step 2: Divide those goals into specific objectives
Now that you have a goal in mind, it’s time to decide how you’re going to achieve it.
Specify different objectives that you’ll have to accomplish to meet your overall goal.
For example, if The Gang needed to increase revenue, two of their objectives could be:
- Increase sales by 20%
- Attract 2,000 customers a month
It’s important to ensure that your objectives are specific as it’s going to make tracking your overall performance easier.
Step 3: Choose multiple KPIs to track your progress
Now that you’ve set your objectives, it’s time to choose multiple KPIs to track your objectives.
If we stick to the objectives The Gang chose earlier, they could use a business KPI like:
- Sales growth: to monitor how well they’re hitting their KPI target of increasing sales by 20%
- No. of customer walk-ins: to check how far they’re progressing in attracting 2000 customers a month
Step 4: Track your KPIs with a reporting tool
Now that you’ve got your goals, objectives, and KPIs sorted out, there’s only one thing left to do:
(Well, at least not yet)
You now need to input all this data into a reporting tool and start tracking your KPI progress.
Inputting reporting data? That sounds so tedious!
That’s because it is.
But don’t worry, there’s a way out.
All you need is a powerful, automated KPI dashboard to take care of everything for you.
But where are you going to find one of those?
The Best KPI Dashboard for 2020: ClickUp
ClickUp is the world’s #1 project management tool that’s used by 100,000+ teams around the world. From teams in startups to teams with giants like Google, Airbnb, and Nike, everyone loves choosing ClickUp as their go-to KPI dashboard and strategic goal tracking hub.
Here’s why you should use ClickUp for all your KPI reporting dashboard needs:
ClickUp’s Goals feature is the easiest way to keep track of all your KPIs.
In ClickUp, Goals are high-level containers that are broken down into smaller Targets. These Targets are essentially the objectives you complete to meet your overall Goal.
For example, if The Gang’s strategic Goal was to attract 50 more customers a week, their Targets could be:
- Run a powerful social media campaign
- Generate and distribute 1000 flyers across their neighborhood
- Lower their alcohol prices
And they meet each strategic objective (Target), their overall strategic Goal progress updates in real-time!
But wait… where are the KPIs here?
In ClickUp, you can customize the metrics to measure your Targets, such as:
- Numbers: numerical figures such as scores and percentages
- Currency: a target value like revenue and profit
- Tasks: for tracking performance based on task completions
Here’s how it all looks in action:
- Create a Goal
(attract 50 more customers a week)
- Assign a strategic objective (Target) that will help you achieve that strategic Goal
(create and distribute 1000 flyers)
- Choose your metrics that will measure your strategic objective (Target) progress
(use the numerical metric in ClickUp)
- Start tracking your progress!
Bonus: This feature is great for remote teams as they can easily monitor their goal progress without having to be in the same office.
If you’re looking for the perfect way to visualize your KPIs, look no further than ClickUp’s Dashboards. Use it to get high-level visual overviews of your KPIs in seconds!
Each KPI reporting Dashboard contains a number of Custom Widgets, with each one tracking a chosen key metric in the way you want.
Here’s a list of all the widgets you can access in this KPI software:
- Line Chart
- Bar Chart
- Pie Chart
- Battery Chart
- Calculation (to calculate numerical KPI data like sums and averages)
It doesn’t matter what kind of metrics you’re tracking.
They could be a marketing KPI, financial KPIs, beer KPIs – ClickUp’s going to handle whatever you throw at it!
Okay…maybe not that.
Additionally, each Dashboard’s access rights are customizable – making it easy for you to share it with clients and other key stakeholders.
We all know that The Gang is pretty dysfunctional, right?
But it doesn’t have to be that way.
If they used ClickUp’s performance reporting analytics, they’d have no trouble with performance management.
Here’s a breakdown of how ClickUp’s KPI reporting dashboard can help you with performance measurement:
- Completed: use number of completed tasks as a base measure of performance
- Worked on: use number of tasks worked on as an indicator of effort
- Time tracked: use time spent on work as an indicator of efficiency
- Workspace points: assign points to work activities to gamify the performance management process
ClickUp isn’t just a KPI software.
We at ClickUp know that there’s no such thing as too many features.
Just like Charlie’s relationship with cheese here:
ClickUp is an all-in-one project management solution with tons of other features like:
- Project Management Automation: automate repetitive processes to save time
- Pulse: check what your team’s currently focused on
- Agile project management reports: track your Agile and Scrum projects with burndowns, burnups, velocity charts, and cumulative flow diagrams
- Custom Statuses: create customized project statuses for projects
- Weekly Scorecards: performance reporting over your team’s weekly activities
- Priorities: to always attempt your most important tasks first
- Custom Access Rights: share your tasks with key stakeholders without worrying about privacy concerns
Using KPIs is one of the easiest ways to stay on top of your key business goals and objectives.
But remember, selecting KPIs is just one part of the process.
You need a way to track them too!
And what better way to do that than to use an advanced business reporting tool like ClickUp?
It’s got everything you need to stay on top of your KPI progress and measure team performance.
So why not sign up for ClickUp today, because: