How to choose the right KPIs for your business

Choosing KPIs begins with business objectives, never with available metrics. The right question isn't "what can I measure?", but rather "what do we want to achieve?". From these objectives (sell more, generate leads, build brand, foster loyalty), you identify which indicators show progress towards them. KPIs disconnected from objectives are just numbers; KPIs derived from objectives are compasses. Clearly defining what you want to achieve is the first and most important step.

A good test to know if something is truly a KPI is to ask: if this metric changes, would it make you take a different decision? If the answer is yes, it's probably a relevant KPI. If it's no, if the number goes up or down and nothing changes, it probably shouldn't be a KPI. The right indicators are those that inform action: they show whether something is going well or poorly and guide what to do. Metrics that don't lead to any decision just take up space and attention.

A common pitfall is choosing vanity metrics: large, impressive numbers that look good but don't guide decisions or connect to results. Many followers, many visits, or many likes might seem like great KPIs, but if they don't translate into results, they deceive more than they help. When choosing KPIs, it's always worth asking if that number truly reflects progress towards objectives, or if it just looks good. Avoiding vanity metrics is essential for choosing indicators that matter.

A common mistake is wanting to track dozens of indicators. But tracking too many metrics disperses focus and makes it hard to see what matters. The ideal is to choose a few truly relevant KPIs and track them in depth. A lean set of the right indicators is much more useful than a dashboard cluttered with numbers. The discipline of choosing a few good KPIs, instead of trying to measure everything, is what brings clarity and focus to analysis. Less, but relevant, beats a lot and scattered.

It's worth considering that different business levels need different KPIs. The executive board tracks strategic and results-oriented indicators; the campaign team tracks more operational and tactical metrics. It's not about having a single set of KPIs for everyone, but about defining the right indicators for each level and function. This ensures that each person tracks what is relevant to their decisions, without getting lost in numbers that don't pertain to their work.

The right KPIs today may not be the right ones tomorrow. As the business evolves, objectives change, and indicators must keep pace. Therefore, it's worth periodically reviewing whether the chosen KPIs are still the most relevant, adjusting the set as the strategy changes. KPIs are not a definitive choice, but a living selection that should reflect the business's current moment and priorities. Reviewing them from time to time ensures that you continue measuring what truly matters.