Peter F. Drucker once said, “If you can’t measure it, you can’t improve it.”
This holds true for every business that is looking to grow their business and expand their reach. Once you know which aspect of your business requires a boost, you can begin making the improvements needed.
What are KPIs?
Key Performance Indicators (KPIs) are measurable values that demonstrate how effectively a business is achieving key business objectives. They are used to evaluate a firm’s success at reaching targets. KPIs help you measure the metrics that matter, so you know where to focus and where not to.
That said, not everything that can be measured matters. For example, the number of ‘likes’ you get on your social media page is not a true indicator of how your translation firm is doing. On the other hand, the percentage increase in the number of new customers for particular language pair is an important metric that could indicate an increase in market demand that you should pursue.
KPIs must be chosen very carefully. They should be measurable, actionable, and understandable.
Here are some examples of KPIs for a translation firm looking to measure their translation/service volume:
- Monthly new customers
- Monthly new leads
- Customer Retention rate
There are certain objectives behind setting up each set of KPIs that govern which factors are being measured. The objective could measure:
- Translation volume
- Reputation growth
- Revenue growth
- Employee turnover rate
Each of the above-mentioned objectives will require their own set of KPIs to measure how well the business is doing in meeting the objective.
KPIs can also be used to measure reputation growth, such as:
- Customer turnover rate (how fast your customers are leaving you)
- Customer retention rate (what percentage of your customers are staying with you)
- Net promoter score (customer satisfaction index)
- Employee satisfaction (reflected by your employee retention/turnover rate)
- The popularity of services provided by your firm (reviewing your marketing analytics will give you an idea on this one)
Another important set of KPIs are those that measure Revenue Growth.
- Monthly/quarterly sales growth
- Customer acquisition cost
- Customer profitability
- New prospects or leads converted (monthly/quarterly)
KPIs should always correlate to business goals that can be quantified and should be measured at fixed intervals to help you spot trends and set future strategy. The amount of data you need depends on the size of your business, your turnover, and the growth.