Key Performance Indicators or KPI’s as anyone who has implemented them or is responsible for their ongoing management can tell you, are painful at the best of times. But KPI’s can play a vital role in the strategic management of an organization large or small. One of the biggest challenges with KPI’s is where the metrics come from and how they are integrated. an ERP program, once successfully running (are they ever?) can be a prime source for data. As the Web becomes more entangled into businesses, KPI data will presumably become easier. We have found that Web Analytics data, properly used, can be used as a Leading Indicator in your KPI program.
KPI’s rely on both Leading and Lagging Indicators. A lagging indicator is revenue results or inventories from past quarters that are compared to a Leading Indicator such as current gross sales. Over time, Leading Indicators can be used to look at the history of Lagging Indicators to get a sense of seasonality, production peaks and valleys and changes in the market position of the company. So how do Web Analytics play a part?
Few companies have a Web presence for the sake of a brochure, and if they do, they’re likely missing the point of what the Web has become, no matter the size of the organization. A good Web Analytics package such as Web Trends or ClickTrends and even the free and very usable Google Analytics can, over time become a vital part of your KPI’s. Analytics gives you a reliable, instant and trailing view of everything happening with your Web traffic. Not just in term of sales, but what people are doing when they visit your site, and how they even arrived there. Just a Pay-Per-Click campaign uses Analytics to measure conversion and ROI which translate into current sales as a KPI, so does how people use your site.
As an example, HR can look at the analytics to determine how many people looked at the Career section of the website, and where they went on the site after looking at current job postings. This can tell them the success of recruiting advertising as well as getting a sense of what content they need to keep relevant elsewhere on the site. Production might use visits to the product pages to obtain a sense of what products the market is most interested in, which can then help them work with marketing to push a certain product and thus prepare inventory levels accordingly. Senior management can use Web Analytics to get a “sense” of what is happening with interest in the market place.
Now combine your Web Analytics tool with a reputation management solution and you start to have a very powerful set of benchmarking tools to work with. Web analytics can play a vital role in managing your KPI program or as a part of it. It’s all in how you use them.