Key Performance Indicators (KPI)

Solution Overview

Key Performance Indicators (KPIs) are quantifiable metrics used to evaluate and measure the success or performance of an organization, business unit, project, or individual in achieving specific objectives. KPIs provide a clear and objective way to track progress and make informed decisions based on data-driven insights. They play a crucial role in assessing the effectiveness of strategies, identifying areas for improvement, and ensuring alignment with organizational goals.

Examples of KPIs include:

Revenue Growth Rate: Percentage increase in revenue over a specific period.
Customer Churn Rate: Percentage of customers who stop using a product or service.
Return on Investment (ROI): Ratio of net profit to the initial investment.
Employee Turnover Rate: Percentage of employees who leave the organization over a period.
Website Conversion Rate: Percentage of website visitors who take a desired action, such as making a purchase or signing up for a newsletter.

In summary, Key Performance Indicators provide a structured way to measure and evaluate progress toward goals, enabling organizations to make informed decisions, optimize performance, and achieve long-term success.

The solution enables KPIs (Indicators) and KPI Measurements (Measurements) and automatically connect them to Years, Quarters, Months, Weeks and Days, so that you could track progress by each of this period. KPIs can additionally be connected to a Custom Period, for example representing Planning Interval, to see how our goals progressing during this Period.

You can create a list of KPIs on a KPI view in the left menu. Define the KPI Name and KPI Result Type – a unit in which a KPI is measured. It can be %, number or any other value.

By collecting measurements for this KPIs you'll see how the Indicators progress over time. KPI Measurements can be added manually, imported via CSV file or automatically from a side system. When created, they are connected automatically to all the respective Periods in the system.

The Current, Minimum and Maximum values will be calculated automatically based on Measurements Values.

On the KPI Progress view you'll see how each KPI progress overtime. Here you can focus on specific KPI or Period.

Value Stream KPIs

There is also an option to create and monitor KPIs within each Value Stream. Value Stream Key Performance Indicators (KPIs) are the quantifiable measures used to evaluate how a Value Stream performs against its business objectives. Development Value Stream KPIs help close the feedback loop from:

Strategic Themes through the Lean Budgeting process
Portfolio Epics established in the Portfolio Kanban
Business Outcomes created by portfolio investments in Development Value Streams

Tips for Establishing KPIs

Since KPIs are specific to the type of Development Value Stream, SAFe can only offer general guidance. However, the following tips and examples provide universal recommendations for establishing KPIs:

Good KPIs focus on objective, quantifiable, and measurable business outcomes
Some Development Value Stream KPIs should focus on process measures such as speed, quality, flow, and self-assessments.
Trending data allows you to predict better what will happen based on history.
Ratio data enables comparison. A sudden spike or a long-term trend becomes visible if you compare a daily metric to the same one over a month.
Limit the number of KPIs tracked for each value stream. Typically, four to seven provides a good set of metrics.

Often, the most meaningful metrics to assess the development value stream’s business outcomes are associated with their operational value streams. For example, the image below highlights some KPIs appropriate for various operational value streams. These metrics tell the story of how well the development value stream produces business results.