KPIs are one of the most powerful tools an organization can harness in their business intelligence efforts. As the name suggests, key performance indicators, or KPIs, are metrics that are used to monitor business activities that are critical to the success of the company. They help to quickly cut through the massive amount of information that constitutes day-to-day business operations to retrieve key insights. This last point is especially crucial, as it allows businesses to make adjustments in real-time. For this reason, in particular, many companies are looking into KPI software tools as a means of maintaining a consistent pulse on their business performance.
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But with so many options on the BI tools market, how can you determine which KPI software is the best? Our analyst team did the research and we’re here to share that information with you.
Before we can analyze any of these KPI monitoring tools, we have to first understand what KPI software is, what it does and why it’s important. Let’s dig deeper and see if we can crack the code of the mysterious KPI.
What is KPI Software?
KPI software refers to tools that automatically track key performance indicators in real time and present them to users in easy-to-understand data visualizations that enable them to spot trends at a glance. These solutions help business users and decision-makers set measurable goals that align with their core objectives as an organization and keep track of their current progress in meeting those goals.
How does it work? Users enter their data into the system, or connect the platform to their existing technologies – then the magic happens. KPI tools collect all that data in real-time, turn it into beautiful dashboards and simplify reporting into forms that enable users to get a quick overview of their insights at a glance. Instant alerts when KPIs dip below and spike above certain thresholds help maintain a steady course of operations.
While KPIs are often used for tracking finances, that’s not the only way to implement them. KPIs can do anything from monitor product quality to track supply chains to measure customer satisfaction, all while providing data for analytics. There’s no one-size-fits-all approach to tracking KPIs; even though there are guidelines for certain industries, at the end of the day, each company has to decide for itself what KPIs it needs to measure. Even companies operating in the same marketplace might have completely different objectives, and thusly, track different sets of KPIs.
Why Use KPI Software?
KPI monitoring tools and dashboard software are essential if you want to reap the full benefits of your BI solution. By tracking the right KPIs, the solution does the hard work for you; it enables you to spend less time doing tedious reporting and more time on taking action. By using KPI measurement tools, it becomes much easier to implement a decision-making strategy that’s based on accurate, concrete data.
But how exactly can KPI software benefit you? Well, here are a few reasons why you should look into KPI tools:
Crucial Information At-a-Glance
By visualizing data in easy-to-understand ways, KPI tools help users who are strapped for time by giving them what they’re looking for – an overview of the metrics that matter most. KPI software achieves this through the dashboard, a data visualization designed to answer a certain question. A dashboard makes sense of and demonstrates the true, underlying meaning of data while making it accessible to all and is usually scannable in about five seconds. Dashboards play a huge role in how a solution can accomplish its goals of providing information at-a-glance.
Better Decision Making
An essential part of running a business is setting and meeting goals. This is where KPIs come in handy – they not only help users track their progress and succeed in meeting their goals in the end, but also help them from the start by helping them to define measurable targets in the first place. One of the main goals of implementing a BI solution is to empower data-driven decision-making and KPI tools help users do just that by providing all the essential information they need to define goals and monitor their performance on the way to achieving them.
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Proactive Problem Solving
KPI tools can help you nip a problem in the bud. Some solutions allow you to set notifications to alert you when your numbers aren’t where they should be, helping you spot problems before they turn into problematic results. KPI monitoring tools help you expect the unexpected and stay one or two steps ahead of any potential issues. Instead of just reacting to changes days after receiving data analysis that took a few days to run, the product can notify you about changes to your KPIs so that you can take corrective action if needed. Taking a proactive approach to deal with small issues prevents them from evolving into more serious issues.
Improved Company Culture
KPI monitoring tools spread data literacy by making insights accessible to everyone. They provide a consistent benchmark of performance, motivating employees by showing the fruits of their efforts. This creates a sense of purpose, helping each employee feel like they are contributing to the overall success of the company. This can not only boost morale but also productivity as everyone strives to improve performance across the board.