Key Performance Indicators (KPIs)

All departments of a business are interconnected. Starting from the procurement department to after-sales services, the output of one department is the input of the next. The process created by all departments is defined as the “Value Chain”. A disruption in the Value Chain can cause the entire process to falter. For example, a problem in the supply of raw materials or semi-finished products can prevent production, and the inability to produce can lead to no sales. Therefore, the inter-departmental “ Workflow” and the “ Job Descriptions” of each department, and even each employee, are determined in detail, put into writing, and communicated to the relevant departments. Thus, employees know and apply what, when, how, in what way they will do it, and with whom they will do it (5W1H). This situation applies in the same way to non-profit organizations (Associations, foundations, etc.). However, in order to control all tasks within the enterprise and to understand that they have been successfully performed, they need to be measured. To define a task or the output of a department as successful, the basic performance values of the work done are determined. These values are called “ Key Performance Indicators”. Their English equivalent is “Key Performance Indicators” or abbreviated as “KPI”. The determination of a business's Key Performance Indicators and the achievement of the determined basic goals are extremely important for the sustainable success of the business. It also ensures that the market value of the business increases, attracts investment, intensifies the interest of foreign entrepreneurs, ensures that its shares are in demand during the public offering stage, and allows small shareholders to be aware of what is happening. Especially in publicly traded companies, the presence of Key Performance Indicators and the sharing of the obtained values are inevitable. In today's uncertain and heavily competitive conditions, businesses need to continuously monitor their Key Performance Indicators and improve them every period in order to gain a sustainable competitive advantage against their competitors, make above-average profits, and most importantly, exist in the future. To be considered successful, it is never enough for a business to just make a profit. A business that makes periodic profits may encounter very great difficulties in the future if it does not determine, measure, and improve the Key Performance Indicators listed below. Undoubtedly, many Key Performance Indicators can be counted for a business. However, the following 75 Key Performance Indicators are truly issues that should be constantly measured in a business. At least more than half of these indicators must be evaluated: When Measuring Financial Performance: Net Profit Net Profit Margin Gross Profit Margin Operating Profit Margin Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) Revenue Growth Rate Total Shareholder Return (TSR) Economic Value Added (EVA) Return on Investment (ROI) Return on Capital Employed (ROCE) Return on Assets (ROA) Return on Equity (ROE) Debt-to-Equity (D/E) Ratio Cash Conversion Cycle (CCC) Working Capital Ratio Operating Expense Ratio (OER) CAPEX to Sales Ratio Price Earnings Ratio (P/E Ratio) When Understanding Customers: Net Promoter Score (NPS) Customer Retention Rate Customer Satisfaction Index Customer Profitability Score Customer Lifetime Value Customer Turnover Rate Customer Engagement Customer Complaints When Measu…