KPI's Are Old School: Let's Focus on KSI's

A lot of smart, good, well-respected people talk about key performance indicators (KPI's), including Eric Peterson's excellent Big Book of KPI's. So I don't want to knock KPI's. And for a long time, KPI's have often been an excellent measure, but of performance, not necessarily success.

Maybe this is an issue of semantics, but I don't think so. I want to make a case that KPI's should be supplemented with KSI's (key SUCCESS indicators).

When you're measuring performance, you're looking at what has already happened. Things like how long it takes a page to load, how many visitors, bounce rates, search results . . . all those things reflect what has already happened.

The problem is, we measure what we know how to measure: performance. Measuring success is a much harder thing to get your mind wrapped around. Sure, you can measure sales as an indicator of success, but even that reflects what has already happened. Conversion rate is another good example that tends more towards being an indicator of success than just performance, but again is backward looking. And for that matter, conversion rate can often be a very misleading metric.  If you've ever heard me speak, you've probably heard me ask: how can you steer a car in the right direction if you're always looking in the rear-view mirror?

The bottom line is that behavioral data is backward looking. Important data, yes. Valuable data, yes. Insightful data, yes. But it doesn't help you as much as it could. The other issue is that behavioral data doesn't really measure the success of the experience and therefore the long-term value to the organization.

Satisfaction data, when measured correctly, is forward looking. Academic studies show that certain satisfaction methodologies can actually predict the future. They can tell you what your customers are likely to do tomorrow.

Some examples of KSI's: satisfaction, purchase intent, likelihood to recommend, likelihood to use the website as a primary channel, etc. In other words, KSI's = future behaviors.

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