Essential Steps of the Key Performance Indicators Cycle
Part of the Business Intelligence For Dummies Cheat Sheet
Business intelligence (BI) is an activity, tool, or process that allows businesses to create clarity and support around their decision-making approach by determining key performance indicators (KPIs). The success level of any business endeavor can almost be measured or quantified in some aspect:
Step 1: Build or define the core business strategy or objectives
Step 2: Specify progress metrics (KPI’s), and define thresholds that indicate degrees of success.
Step 3: Measure performance over time as a baseline
Step 4: Adjust tactics and gauge correlative changes in success metrics
Step 5: Apply lessons to subsequent strategy definition
But business intelligence is very much a cultural phenomenon, moving away from gut-feel strategic choices and moving toward an evidence-driven rational approach to business.