Customer-Focused KPIs Fuel the Future of Business

Recent research from MIT Sloan Management Review and Google shows a surprising pattern in executives’ use of key performance indicators (KPIsWe define key performance indicators (KPIs) as the quantifiable measures an organization uses to determine how well it meets its declared operational and strategic goals.1) to manage and lead their organizations. But what sets leading companies apart is not so much the number of metrics they track but how they use them to better engage customers — and thereby grow their businesses.

To determine if you’re on the path toward strong KPI alignment, scroll down to give our findings a read — and take our self-assessment.

1. We define key performance indicators (KPIs) as the quantifiable measures an organization uses to determine how well it meets its declared operational and strategic goals.

KPI-Based Leadership Drives Business Forward

2. Respondents were asked “To what extent do your organization’s KPIs drive how you lead and/or manage your people and processes?” Those who answered to a moderate or great extent are represented in the 70%.

What’s KPI Alignment?

Our study measured the role of KPIs in aligning an organization toward its objectives. Three categories emerged: Measurement Leaders, Measurement Capable, and Measurement Challenged.

Leading companies recognize the complexity customers face in a digital world and develop customer experience KPIs beyond the sales funnel.

MORE ON THE KPI ALIGNMENT INDEX

The Customer Is the Business Strategy

Organizations at all alignment levels are using customer-focused KPIs.Respondents were asked if their functions use KPIs to measure customer segmentation, customer lifetime value, brand equity, and churn. Leading companies are even more likely to prioritize customer-related KPIs to gain competitive advantage.

Overall Results

Alignment Index

Organizations are more than four times as likely to prioritize “customer”-related KPIs over any other measurement.Respondents were asked the free-response question: Excluding gross revenue, what are your three most important KPIs? 38% of respondents used the word “customer” in their response, while the term used with the next highest frequency was “sales” (9%).4

Customer

4. Respondents were asked the free-response question: Excluding gross revenue, what are your three most important KPIs? 38% of respondents used the word “customer” in their response, while the term used with the next highest frequency was “sales” (9%).

Companies Use KPIs to See The Full Picture

Measure Your KPI Alignment

Take our self-assessment to uncover challenges and opportunities based on your KPI alignment.

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The findings from the 2018 Strategic Measurement Global Executive Study and Research report will be published on June 26, 2018.

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