A KPI (Key Performance Indicator) is a metric that measures performance against a target in an area critical to the business — e.g. delivery performance, OEE, complaint rate or absence. Good KPIs are few, influenceable and updated close to real time.
Distinguish between result KPIs (lagging — e.g. last month’s delivery performance) and process KPIs (leading — e.g. number of deviations closed on time). Results cannot be managed directly; the processes that create them can.
A KPI’s value is decided by the routine around it: a number no one reacts to is decoration. Every KPI on an operations board should have an owner, a target and an agreed reaction to deviations.