It’s not uncommon to see the terms analytics, metrics and KPIs be used interchangeably. The problem is, these terms aren’t the same, and using them correctly makes a difference.
The way we use words changes the way we think about and understand them. So using them interchangeably not only creates confusion, it can actually be bad for business.
To get real power out of your data, it’s important to understand the relationship between KPIs and metrics, and how to use them.
What is a Metric?
A metric is a quantifiable measure that is used to track and assess the status of a specific process. Another way of saying this is, a metric is a measurement you record to track some aspect of your business activity and measure the success or failure of the performance of that activity.
What is a KPI?
A KPI – which stands for key performance indicator – is also a measurement. Where it’s different from a metric is, KPIs relate to a specific strategic business goal and reflect how successful the business is in achieving that goal. To further clarify, KPIs define a set of values against which the metrics are measured.
Metrics vs. KPIs
Still not clear? KPIs are strategic while metrics are tactical i.e. KPIs reflect a business goal or objective (strategic) and how successful the business is in accomplishing that goal or objective, while metrics reflect how successful the activities taking place are (tactical) to support the accomplishment of the KPI.
The way they relate to each other is very simple: metrics support KPIs and in turn, KPIs support the overall business strategic goals and objectives. The KPI is whether the metric is changing over time and at what rate and in what direction.
A KPI may include the targeted percentage increase in inbound leads over a specific period of time e.g. quarter or year. In this case, the metric will be recorded monthly leads.
Do you need both metrics and KPIs?
Yes. When one of your KPIs goes haywire, you need to be able to look at other metrics to properly diagnose the problem.
In the example above, let’s say your monthly inbound lead numbers (the KPI being tracked) takes a nosedive. While the KPI tells you there’s a problem, your other metrics will help you to understand what happened. It could be broken links on your website or a CRM error that blocked leads from pushing to your CRM. If you’re tracking these metrics i.e. site traffic & conversions, CRM data etc., you’ll be able to identify the root cause.
Displaying metrics and KPIs on Digital Signage
Dragging data from 10+ business apps and tools into an Excel spreadsheet wastes time, creates reports that are hard to read and understand and they are pretty ugly. Plus, these report have to be created on a regular basis.
A business intelligence dashboard brings metrics to life with beautiful visualizations. The visualizations and infographics ofKPIs can be be automatically displayed on digital signage screens. With data at your team’s fingertips and always on their mind, their efforts will align to the goals that matter most.
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