As a business owner or manager, you’ll probably have a lot of data at your fingertips; you’ll also likely be aware of Key Performance Indicators (KPIs) and the significant role they play. But are you aware of which KPIs you should be tracking to ensure your organisation is moving in the right direction?
As a vital tool for any business seeking to drive growth, KPIs offer valuable insight into a company’s strengths and weaknesses, while identifying areas in need of improvement – and thus driving expansion via informed decision making. When it comes to the bigger picture, tracking KPIs can also help to promote transparency around how a business functions on a grander scale. Here, we explore some unique KPIs you may wish to consider on your journey – perhaps towards global expansion – together with tips on where to begin.
Setting KPIs that align with your business goals
When selecting KPIs that align with your objectives, it’s important to get precise. If your goal is to increase revenue for example, then revenue growth would be an appropriate KPI to track. It’s also crucial to consider the unique characteristics and needs of your business during this process. By assigning KPIs that are relevant to your business goals and bespoke to your industry, the resulting insight will be more laser-focused and more valuable on your quest to achieving those long-term targets.
Take a look at these industry-specific KPIs across some of our core customer sectors, including manufacturing and professional services:
Production efficiency: This KPI measures how much output your manufacturing process is producing relative to the inputs, such as labour, materials, and energy.
Inventory turnover: This can help you avoid overstocking or understocking by measuring how quickly you’re selling your inventory.
Quality control: This KPI measures the percentage of products that pass quality inspections, and can help identify areas in need of improvement within the manufacturing process.
Wholesale Distribution and Retail KPIs
Sales growth: This KPI measures how much your sales have grown over a certain period of time, which can indicate the health of your business.
Customer retention rate: Indicating the effectiveness of your customer service and marketing efforts, this measures how many customers you retain over a certain period of time.
Gross profit margin: This KPI measures the percentage of profit you make on each sale after deducting the cost of goods sold.
User engagement: This KPI measures how frequently users are interacting with your product or service, and can indicate its popularity and usefulness.
Conversion rate: From making a purchase to filling out a form, this measures the percentage of users who complete a desired action.
Customer acquisition cost: This KPI measures how much it costs you to acquire a new customer, and can help you optimise your marketing spend.
Professional Services KPIs
Utilisation rate: This KPI measures how much of your team’s time is being billed to clients, and can indicate how efficiently you’re using your resources.
Revenue per employee: Helping you to identify high-performing employees or areas where you need to hire more staff, this KPI measures how much revenue each employee generates.
Client satisfaction: This KPI measures how satisfied your clients are with your services and can help highlight areas in need of improvement.
On the right track with cloud ERP
Cloud ERP solutions can be a game-changer for businesses striving to streamline their KPI tracking. By automating core processes like finance, accounting, and inventory management, cloud ERP solutions like Oracle NetSuite provide businesses with real-time data and actionable insights through unified dashboards. Not only does this enable businesses to track their KPIs more effectively than disparate spreadsheets, but it also helps to increase productivity.
One of the primary advantages of using an ERP system like Oracle NetSuite is the centralisation of all business data. This affords businesses the swifter access and analysis of the intel required to track their KPIs. The integrated software also provides users with forecasting and automation capabilities. For example, an ERP system can help businesses predict demand for their products or services by harnessing real-time data, allowing them to better plan for the future. In addition, the automation of time-consuming accounting and inventory count tasks can free up time for growth-related activities without additional headcount.
By choosing to monitor the most relevant KPIs, businesses can equip leaders with a greater understanding of their financial and operational performance. With the adoption of a leading ERP solution, the process of analysing KPIs can be fast-tracked and easily acted upon, empowering businesses to consistently hit their objectives on the path to growth.
Exploring what a cloud ERP solution could look like for your business? From KPI tracking and beyond, our dedicated team of NetSuite experts can advise on the right solution to fast-track growth. Get in touch via our contact page.