For Subscribers

The Best Way to Track Your Company's Performance

How to pick the key performance indicators that'll be best for your business.

By Joe Worth

Monty Rakusen | Getty Images

Opinions expressed by Entrepreneur contributors are their own.

You need to pick your key performance indicators, or KPIs. They're data used to chart a business on its way to success and profits, and are often used when revenue-starved startups need to identify ways to measure progress in the absence of cash flow. But there's a big risk: If you choose the wrong KPIs, you may drive your company to financial ruin.

So, how to pick? Identify your business goals and the activities that lead directly to achieving them. Keep in mind that more often than not, bad KPIs are the result of upper management and the board deciding what to track. In my experience, you're better off listening to line managers and frontline employees; they'll give you more granular KPIs, to truly show how your company is doing. (See chart below for some starter ideas.)

Continue reading this article — and all of our other premium content with Entrepreneur+

For just $5, you can get unlimited access to all Entrepreneur’s premium content. You’ll find:

  • Digestible insight on how to be a better entrepreneur and leader
  • Lessons for starting and growing a business from our expert network of CEOs and founders
  • Meaningful content to help you make sharper decisions
  • Business and life hacks to help you stay ahead of the curve

Related Topics

Editor's Pick

Have More Responsibilities at Work, But No Pay Bump? Use This Script to Get the Raise You Deserve.
Black and Asian Founders Face Opposition at All Levels — Here's Why That Has to Change
Living

Invest in Yourself: 10 Things Every Working Woman Should Do This Year

When striving for success, it is easy to forget about your mental and physical health. But without health, you cannot fully succeed. Follow these ten lifestyle strategies for success in your personal and professional life.

Thought Leaders

5 Small Daily Habits Self-Made Millionaires Use to Grow Their Wealth

We've all seen what self-made millionaires look like on TV, but it's a lot more subtle than that. Brian Tracy researched what small daily habits these successful entrepreneurs adopted on their journey from rags to riches.

Business Ideas

Every Company Has the Potential to Enter the Space Economy. Here's How.

The space economy is worth nearly $500 billion — why wouldn't you want to get involved if you can? Use these four tips to find out how you can get started.

Management

5 Reasons You're Stuck In the Weeds, Instead of Spending Your Time Strategically

Follow this advice from over 100 top CEOs to become less busy and more successful.