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Achievable Aims – How To Set Realistic KPIs For Your Business

Posted In Business - By Techtiplib on Monday, March 16th, 2020 With No Comments »

As a business owner, you have probably already set some Key Performance Indicators to measure the growth and success of your business. However, have you taken a moment to think about whether the KPIs you have set are realistic, reasonable and actionable? One of the common mistakes businesses tend to commit is creating KPIs that are too far fetched and not grounded in reality. In today’s article, we have a look at how you can set realistic and achievable KPIs for your business, so read on to find out more.

Achievable Aims - How To Set Realistic KPIs For Your Business

1. Focus on Benchmarking

Benchmarking is the process of comparing one’s performance metrics and business processes to successful competitors or industry bests in order to determine what metrics you should be reaching in order to help you succeed in your particular market. Utilising the metrics of a successful competitor and creating KPIs that strive to achieve similar levels to competitors is one of the best ways to ensure that you are setting realistic and achievable KPIs. Benchmarking gives you a tangible goal that you can work towards – if your competitors can do it, so can you!  

2. Create Specific Targets

Creating specific and measurable targets is key in setting realistic and achievable KPIs for your business. For example, targets should be time bound and can be set in the following format: “An increase of 5% by November 2020”. Keeping targets precise and not vague is key in ensuring that you have an actionable goal that you can work towards. Removing the confusion of ambiguity will allow your business to keep track of where it is heading. 

3. Continuously Review With Your Team

Once you’ve set a target, the work doesn’t quite end there. In fact, targets should be reviewed with your team in an open and honest environment. If you aren’t reaching your targets, it is important that you allow your team to voice their opinions on how things could change or be adjusted to help reach your goals. We suggest reviewing your targets on a monthly basis and being entirely transparent in order to succeed. Honing in on any potential issues sooner rather than later is the best way to prevent failure to reach your goals. Having an open mind and embracing the fact that sometimes your goals will have to be shifted is also key in setting realistic KPIs. 

4. Differentiate Short Term from Long Term Targets

One of the biggest mistakes that business owners make is the failure to set short term targets. Many business owners focus on the macro perspective whilst neglecting the micro perspectives that can help build towards your company goals. Setting short term goals that your team can achieve can help keep everyone in positive spirits and offer them the reassurance that they are doing a good job and on their way to reaching the ultimate KPI levels. Celebrating small wins and working step by step rather than leaping is key in ensuring that your KPIs are realistic.

5. Don’t Go Overboard

When it comes to KPIs, it can be all too easy to go overboard and set 100 goals. Unfortunately, doing so is more counterproductive than it is productive, which is why we recommend setting no more than 10 KPIs at once. With too many KPIs, your staff will struggle to meet demands and chances are performance will dwindle and levels will start slacking. Pick the most important factors of your business to focus on and assign only as many KPIs as needed to keep things simple.  

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Setting realistic and actionable KPIs for your business doesn’t have to be a mammoth task. We hope that this article has given you some insight into how you can go about setting achievable goals for your business.

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