How to set KPI

KPI is to measure the quality of work results through several key indicators. It is simple and crude, but also very useful. To put it simply, your boss will agree with you on several target values ??in advance, with a monthly/quarter/year statistical cycle. After each cycle, you will review your performance of these indicators. If the target value is not achieved, the performance bonus will be deducted; if the target value is achieved, the performance bonus will be added.

KPI setting mainly focuses on three aspects:

1. Use the AARRR model to organize your user life cycle;

2. Organize each position Job content and responsibilities;

3. Know yourself and your enemy, and see how the industry sets it up (refer to the recruitment notice).

User operation KPI setting process:

KPI planning: Planning should come from business logic. The core of our business is user-related work. User operation indicator database: data evaluation indicators for key nodes of key tasks; job content: role indicator allocation of each position in user operations: allocate indicators in the indicator database according to the relevance of job responsibilities.

The AARRR model divides users into five stages: fan attraction, activity, retention, income, and fission.

Activity and retention can be classified into one part due to their close nature. Therefore, based on the AARRR model, user operation KPIs can be divided into the following four categories of indicators:

User drainage indicators: The scale and efficiency of acquiring new users;

User activity/retention indicators: evaluation of new users’ continued interaction or purchasing behavior with the brand within a certain period of time;

User income indicators : In a certain period of time, the revenue contributed by users to the brand;

User fission indicator: the efficiency, quantity or amount of users spreading the brand to their relatives and friends through their own network.

The user life cycle is divided into: active, silent, sleeping, churn, and death.

Among them, the AARRR model has actually included active to dormant, and the KPI indicators we can get from the life cycle are churn indicators.

Loss warning: how many users meet the definition criteria of pre-churn users within the statistical period;

churn indicator: how many users have lost during the statistical period;

Churn recovery indicator: How many lost users interacted or purchased with the brand again during the statistical period.

Extended information:

Key performance indicators are a target method for measuring process performance by setting, sampling, calculating, and analyzing key parameters at the input and output ends of the organization's internal processes. Quantitative management indicators are tools that decompose an enterprise's strategic goals into operable work goals and are the basis of enterprise performance management.

KPI can be the department head clarifying the main responsibilities of the department, and based on this, clarifying the performance measurement indicators of department personnel. Establishing a clear and feasible KPI system is the key to good performance management. Key performance indicators are quantitative indicators used to measure staff performance and are an important part of performance plans.

The KPI method conforms to an important management principle - the "28 Principle". In the value creation process of an enterprise, there is an "80/20" rule, that is, 20% of the key personnel create 80% of the enterprise's value; and the "28 principle" also applies to every employee, that is, 80% of work tasks are accomplished by 20% of key behaviors.

Therefore, it is necessary to capture 20% of the key behaviors, analyze and measure them, so as to grasp the focus of performance evaluation.

Reference: Baidu Encyclopedia-KPI