KPIs: Measurable outcomes that keep you accountable

The urgent demands faced by a business owner never seem to stop. From employees and vendors to clients and customers, there are a lot of people and problems vying for your attention.

If you’re like most small business owners, you work hard. Every day, you show up and do your best to confront the most urgent issues first, hoping to get a little space before the end of the day to work on the long list of tasks that are important, but not necessarily urgent.

This mentality of putting out fires is well intentioned, but the problem is there’s never much room for anything else. Instead of making progress, you feel further and further behind. And even though you’re exhausted at the end of each day, you can’t necessarily point to what you accomplished. Where is your energy going?

How KPIs keep you focused on priorities

There will always be urgent issues that require your attention. But without a set of focused goals, those issues can easily take over your entire business.

Establishing Key Performance Indicators (KPIs) is an effective way to focus your time and energy. When used correctly, KPIs serve to keep the important metrics of your business at the forefront, where you can periodically review and assess them.

What is a KPI?

A KPI is a measurement that helps gauge how a business is functioning. It’s not comprehensive of every aspect of a business, but by looking at a specific aspect of a business it serves as good proxy for its overall health.

A KPI should be both quantifiable (measurable with reasonable accuracy) and stable, so that it can be meaningfully compared across time. An example of a KPI for an insurance claims processing company would be identifying its error rate in processing claims. This would be an important indicator of quality.

Advantages of KPIs

By tracking a set of KPIs, you get the benefit of knowing whether your efforts have been successful or not. Instead of wondering where your time went, you have objective measures to show you. Even more importantly, KPIs can help you determine how much time and energy to spend on different things in the future.

KPIs create accountability. You choose to track something—say, the number of outbound calls placed every day—because it’s important to the health of your business. At the end of a month, if there were 30% fewer outbound calls placed than the month prior, you are forced to find out why and ensure it doesn’t happen again. Instead of a nebulous “let’s do better,” clear goals provide for a clear path of action.

KPIs also serve to help focus a team’s efforts. People tend to perform based on how they are measured. By making clear to your team which outcomes matter most, you give them confidence that their efforts are important and won’t go unnoticed.

 By reviewing your KPIs on a regular basis, you’ll consistently get a snapshot of your business’s health. That knowledge will inform your day-to-day activities and help you prioritize between the things that are urgent and those that are important.


The concepts in this article were taken from the Key Performance Indicators element, one of the 11 elements of an exceptional business. Visit our website to learn more and subscribe to the blog to receive future articles straight in your inbox.