A metric is a standard of measurement. A Key Performance Indicator (KPI) is a measurable value that demonstrates how effectively a company is achieving key business objectives. Organizations use KPIs to evaluate their success at reaching targets.
What’s the difference? A KPI is a “metric that matters.” It relates directly to the business’s objective or goal to help keep the strategy on track. Because a KPI is a metric that matters, a KPI is a metric that is tied to a target.
The video above explains the difference and offers examples.
Anivash Kaushik, Digital Marketing Evangelist at Google, says a key performance indicator (KPI) is a metric that helps you understand how you are doing against your objectives. Here’s how other experts define the difference between a metric and a KPI.
How do you chose KPIs. Look for the key metrics that:
- Relate to your business objective
- Provide context by being tracked over time
- Are based on legitimate data
- Are easy to understand
- Create meaning
- Can be acted upon
- Do it with the key stakeholders who are accountable
The video was created by Rutgers Business School Executive Education. I have had the privilege of serving on their MBA Faculty for 8 years. The Rutgers Business School is ranked #3 in the nation in MBA employment.
Rutgers Business School Executive Education offers Mini-MBA’s in Digital Marketing and Social Media Marketing. They occur offline in a week-long curriculum in an open classroom. Or online over 10 weeks at a pace that accounts for an executive’s busy work schedule. Digital Marketing is ranked among the Top 30 Best Value certificate programs.
Both consist of the same 10 modules that include: Digital and social strategy development, search engine optimization, paid search, content marketing, mobile marketing, video marketing, customer experience and measurement and ROI.
Either is going to up your game in fastest growing marketing channels, help advance your career or assist you in your own reinvention.
Does this video explain the difference between a metric and a KPI to you? Is your organization ready to put to use the KPIs that keep your business strategy on track?