What is the purpose of setting key performance indicators (KPIs)?

Setting key performance indicators (KPIs) serves to clearly define what success looks like for a team or organization and to provide a framework for tracking progress toward that success. By establishing specific, measurable goals, KPIs help teams understand their priorities and align their efforts towards achieving desired outcomes. This clarity allows for informed decision-making, as teams can assess their performance in relation to the set benchmarks. Furthermore, tracking progress through KPIs facilitates continuous improvement, as it enables teams to identify areas that require attention and adjust their strategies accordingly. Overall, the use of KPIs is a critical practice in performance management, aiding both teams and individuals in reaching their targets effectively.