---
title: "KPI (Key Performance Indicator)"
description: "KPI stands for key performance indicator: a measurable value that shows how well a team or company is achieving its most important objectives. See examples."
url: "https://sageo.ai/glossary/kpi"
source: "Sageo (sageo.ai)"
---


# KPI (Key Performance Indicator)

KPI stands for key performance indicator. It is a measurable value that shows how well a person, team, or company is performing against its most important ongoing objectives. "Key" is the important word: out of everything you could measure, KPIs are the handful that tell you whether the business is healthy.

**Also known as:** key performance indicator, kpis, performance indicator

## Key takeaways

- A KPI is a metric chosen as a key indicator of ongoing success.
- KPIs are the dashboard (health you watch); OKRs are the route (change you drive).
- Good KPIs are specific, measurable, owned, and reviewed on a regular cadence.
- Track a handful that matter, not every number you can collect.

## At a glance

- **What it is:** A metric chosen as a key success signal
- **KPI vs OKR:** Dashboard (health) vs route (change)
- **Cadence:** Reviewed weekly, monthly, or quarterly
- **Related:** OKRs, performance metrics

## Why do KPIs matter?

KPIs keep teams focused on a few numbers that matter instead of dozens that do not. When a KPI moves the wrong way, it tells you where to look before the problem shows up in revenue.

## Examples by team

| Team | KPI |
| --- | --- |
| Sales | Monthly new revenue, win rate |
| Customer success | Net revenue retention, churn rate |
| Support | First response time, CSAT |
| HR | Attrition rate, time to hire, eNPS |
| Engineering | Deployment frequency, change failure rate |

## KPI vs OKR

KPIs measure ongoing health, like a car's dashboard. OKRs are for driving a specific change in a set period, like a route to a new destination. When a KPI slips, it often becomes the target of an OKR.

## Worked example

An HR team tracks three KPIs: attrition rate, time to hire, and eNPS. Attrition jumps from 9% to 14% over two quarters. The team sets an OKR for Q3: "Make our first 90 days the best part of joining", with key results tied to onboarding and 90-day retention.

## Frequently asked questions

### How many KPIs should a team have?

Usually three to five. More than that and none of them are really "key".

### What makes a good KPI?

It is measurable, tied to a clear objective, owned by someone, and reviewed on a regular rhythm.

### What is the difference between a KPI and an OKR?

A KPI tracks the ongoing health of something; an OKR drives a specific change over a set period. KPIs are the dashboard, OKRs are the route.

### What is an example of a KPI?

Monthly recurring revenue, customer churn rate, average resolution time, or 90-day new-hire retention.

### What is a leading vs lagging KPI?

A lagging KPI measures a result (revenue); a leading KPI measures an early driver of it (qualified pipeline). Good dashboards use both.

### How do you choose the right KPIs?

Pick a few that map directly to the outcome you care about, can be measured reliably, and have a clear owner. Drop vanity metrics.