A Key Performance Indicator (KPI) is a reporting tool which measures a value showing how effectively a company is achieving its strategic goals. It is a series of measurements of how a business is progressing in the medium and long term.
Objectives of KPI report:-
- To monitor Company Health.
- To measure progress.
- To analyze patterns over time.
- To solve the problems or tackle opportunities.
- To make adjustments & stay on track.
Benefits of KPI report:-
Measures budgeted sales– KPI reports assist in providing the analysis on budgeted sales over the achieved sales during the specified period of time that eventually helps in analyzing all the discrepancies.
Reduction of cost– KPI reports helps in small business accounting to reduce the cost by measuring the unnecessary expenditure over the necessary and helps to manage the cost for the future.
Retention of Consumer with product Satisfaction– KPI helps to obtain how the ultimate consumer is satisfied with the product and provides the retention ratio of consumer.
Satisfaction of workers– Workers are the key persons of any organization, KPI provides the checks on satisfaction level of workers during their work which helps to retain the worker for a long period for smooth working of the organization. It also helps in the accurate payroll processing services.
Improving Quality– KPIs help companies to identify their respective strengths and weaknesses and how those traits line up with their objectives which increases in the overall quality of operation.
How KPI reports helps in different Sectors:-
Construction Company–This is not just confined to small business accounting but impacts large number of sectors as well. Competition in the construction company at its boom, where KPI reports plays a vital role in accounting to determine the pace of cost which can be direct cost or indirect cost, it eliminates the unnecessary cost for future projects. It also helps to determine the target consumers to achieve budgeted sales.
Retail Sector– KPI reports analyze the purchasing behavior of customers that provides the average transaction size and average unit per customer. In this manner, the company will know about purchase trends over the year, or how effective sales teams are. It also helps to identify customer retention measures in the capacity of a retail business to generate recurring revenue from already existing clients’ database.
E commerce Business– KPI report play a vital role in e-Commerce business by calculating the conversion rate of visitors to sales. It also provides the critical metric that determines the success of website traffic which includes page views per visit, referring traffic source, time on site, bounce rate.
IT Company– An IT KPI or metric assists in keeping a track of all relevant aspects of quality regarding an IT project. It also monitors the average handle time, server downtime which enhances your maintenance by controlling down times. It also analyses how fast you resolve different incidents and track the efficiency at solving issues.
In order to know the insights of your small business accounting and identifying the KPI which are relevant to your industry, we at Whiz Consulting specialize in suggesting KPI that are relevant for your business and thereafter computing them. This will help you in taking business strategic and operation decisions in the most efficient manner.