In simple words, KPI is a system of measurements that helps to understand how well is your team/company/enterprise performing.
KPI's aim is to make it clear to the team whether they are moving in the right direction to achieve corporate strategic objectives in time. Here are some of the characteristics of effective KPI:
- It is clear-cut and measurable.
- Shared within the team and company.
- Essential for reaching your goal.
- Relevant to your department or Line of Business (LOB).
Because of the large number of KPIs, choosing the ones that are relevant to your IT company can be hard. When you miss choosing the correct KPIs you start measuring metrics that are not consistent with your objectives. A clear understanding of the different metrics that are important for the IT industry is the best way to decide what to measure.