Strategic KPIs: Examples and Best Practices in 2023!

In this article, you will learn what strategic kpis are, how to develop effective strategic KPIs and some examples from 6 different industries.

What is a Strategic KPI?

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A strategic KPI (Key Performance Indicator) is used to track progress towards a long-term strategic objective or goal. For example a company might want to Increase market share by 15% within three years.

Strategic KPI Examples

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Here are some examples of strategic KPIs for different industries:

Retail Industry:

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• Increase average customer spend by 20% over the next two years.
• Grow online sales revenue by 30% within the next 18 months.
• Expand store network by opening 10 new locations in the next three years.

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Manufacturing Industry:

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• Reduce production lead time by 15% over the next two years.
• Increase overall equipment effectiveness (OEE) by 10% within 18 months.
• Decrease product defect rate by 8% in the next 12 months.

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Healthcare Industry:

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• Improve patient satisfaction scores by 15% within the next two years.
• Reduce average patient waiting time by 20% in the next 18 months.
• Increase the percentage of successful treatments by 10% over the next three years.

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Technology Industry:

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• Launch 3 innovative products or services in the next two years.
• Increase active user base by 25% within the next 18 months.
• Achieve a 5% market share in the target segment by 2025.

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Financial Services Industry:

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• Increase assets under management by 20% over the next three years.
• Improve customer acquisition rate by 15% in the next 24 months.
• Reduce operational costs by 10% within the next two years.

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Education Industry:

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• Increase student enrollment by 15% over the next two years.
• Improve average graduation rate by 10% within the next three years.
• Expand course offerings by adding 5 new programs by 2025.

How to Create Strategic KPIS

To create strategic KPIs, a company should follow these steps:

1. Align KPIs with Organizational Goals:

Ensure KPIs support the organization's vision, mission, and strategic objectives.

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Example: A retail company might aim to increase customer satisfaction and brand loyalty.

2. Develop Specific, Measurable KPIs:

Define quantifiable KPIs with clear targets or benchmarks for evaluation.

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Example: A healthcare provider may set a target of reducing patient wait times by 15% within the next year.

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3. Select Relevant KPIs: 

Choose KPIs that directly impact strategic objectives and highlight critical areas.

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Example: A manufacturing firm could focus on improving production efficiency by tracking overall equipment effectiveness (OEE).

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4. Track and Analyze KPIs Regularly: 

Monitor KPIs to identify trends, measure progress, and make strategic adjustments as needed.

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Example: A technology company might assess monthly user growth and adjust marketing strategies accordingly.

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5. Set Realistic, Ambitious Targets: 

Establish achievable yet challenging goals to drive continuous improvement and performance.

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Example: A financial services firm could aim to increase assets under management by 20% over the next three years.

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6. Communicate KPIs to Stakeholders: 

Share KPIs with relevant parties, ensuring a shared understanding of their roles in achieving strategic objectives.

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Example: An education institution may communicate student enrollment targets to faculty and staff, emphasizing their roles in reaching these goals.

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By following these best practices and examples, organizations can create strategic KPIs that effectively drive progress towards their long-term objectives.

If you enjoyed this article, you might also like our articles on how to set an effective KPI goal and what a KPI is in marketing.