
Business Intelligence
Track It All With KPI Tracking System
By TechDogs Editorial Team

Overview
This metric helps you keep track and understand how well you're playing. Your high score helps you understand if you're getting better or need to practice more. For instance, if you finish each lap in a racing game quicker than the last, you know you’re improving.
Similarly, businesses also need to keep track of their score frequently and that’s where Key Performance Indicators or KPIs come in. The KPI metric is a number that tells business leaders (read: gamers) how well they’re performing in the industry (read: game). It's an easy way to keep track of their progress to ensure they're improving across various aspects of the business.
So, if you’re looking to improve business outcomes as easily as you got better at your favorite game, you need to know about KPI Tracking Systems. Read on, gamer!
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Welcome to the game. The objective? To beat all the levels and get a comprehensive grasp of KPI Tracking Systems. So, let’s first understand what KPI tracking is, before we dive into level one!
Well, tracking Key Performance Indicators (KPIs) includes several methods that allow business leaders and managers to monitor the performance metrics across the business ecosystem. By capturing the business’s day-to-day operations in the form of data-backed metrics, the overall health of the business can be effectively analyzed and improved. Most importantly, KPI metrics can be used to evaluate if certain operational changes are actually driving improvements within the business ecosystem or make no difference at all, leading to rethinking and revisions.
Measuring Key Performance Indicators involves capturing specific data, converting it into relevant metrics and reporting the insights in easily digestible visuals and dashboards. Sounds like a lot of work, right? This is where KPI Tracking Systems come to the rescue, like an extra life in a video game!
Read on to learn what KPI Tracking Systems are, how they work, their benefits, history, future and a lot more!
Understanding KPI Tracking Systems
Think of Key Performance Indicator (KPI) Tracking Systems as the compass that guides you in a video game, so you don’t get lost. Similarly, it guides businesses toward success without getting lost in decision-making!
In the modern world, everyone wants to leverage data to make the best decisions, right? KPIs are among the most common ways to do this, as organizations can quantify their business performance against strategic goals and outcomes. It essentially provides a roadmap for continuous improvement and innovations through informed decision-making.
With KPI Tracking Systems, business leaders can meticulously monitor and analyze crucial metrics, offering them real-time insights into a business’s performance and health. KPI Tracking Systems can empower businesses to navigate the complexities of their operations with ease as it’s rooted in data and not if, buts and maybes.
Yet, this system wasn’t always there to help decision-makers. Read on to understand how KPI Tracking Systems evolved over time.
Evolution And Origins Of KPI Tracking System
Just as games evolved from grainy 8-bit to high-resolution 4k graphics, KPI Tracking Systems have had a long journey to reach their modern iteration. Here’s a quick breakdown of how that happened:

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1960s
Organizations were manually tracking performance metrics by using basic record-keeping methods. Think spreadsheets and paper-based systems!
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1980s
The introduction of database management tools, especially ones for relational databases, allowed for a more structured and accessible way to store business data. This enhanced the data analytics outcomes for business performance and health.
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1990s
Then Enterprise Resource Planning (ERP) systems were introduced by integrating various business functions. This included KPI tracking across teams and departments via a centralized platform, leading to better coordination and data sharing between stakeholders.
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2000s
With the rise of Business Intelligence (BI), business leaders could access more sophisticated data analytics and insights. This was driven by BI solutions such as Tableau and QlikView, enabling visualization and real-time analysis of KPIs for decision-making.
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Late 2000s
Soon, KPI Tracking Systems evolved as a separate suite to provide real-time KPI tracking. Organizations could respond promptly to the changing business conditions and demands. This led to more focus on the overall performance and output via data-backed metrics.
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2010s
By this time, KPI Tracking Systems became mobile-friendly, allowing users to access business performance data and real-time metrics on smartphones and tablets, adding on-the-go functionalities to KPI analytics.
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Late 2010s
Inevitably, artificial intelligence and machine learning were integrated into KPI Tracking Systems, providing predictive analytics and automated insight generation in real time.
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2020s
Advancements in KPI tracking continued as data visualization technologies improved with the integration of augmented reality (AR) and virtual reality (VR). This enhanced the way KPIs were presented and understood by the stakeholders within a business ecosystem.
This timeline illustrated the evolution of KPI Tracking Systems, from manual record-keeping to sophisticated, real-time, AI-powered decision-making. Yet, how does it all work?
How Does A KPI Tracking System Work?
Now that you know what KPIs are and the need for their evolution, here’s a stepwise process of how a KPI Tracking System actually works in a business ecosystem:

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Establish Goals And Time Schedules
Determining the organizational goals, outcomes and timelines can help you choose the most relevant KPIs to monitor. This way, you can meaningfully track your company's growth, performance, health and other vital metrics.
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Ensure Workforce Data Is Accurate
To accurately track the chosen KPIs, business teams or managers need to record exactly what was achieved on a daily basis. This is critical as KPIs are number-driven and correlate directly with outcomes of certain teams, such as sales and marketing, to assess their performance. As KPI Tracking Systems assess and analyze enterprise data to perform KPI calculations, accurate data is critical.
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Identify Critical KPIs For Organizational Goals
KPI tracking Systems can identify and continually measure the important KPIs in comparison with the quantified goals and deadlines. Depending on your business needs, you might track a single KPI or multiple KPIs across different teams and verticals. KPI Tracking Systems monitors a comprehensive range of data sources to understand the progress toward specific goals and the resources consumed to achieve those goals.
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Integration With Business Apps
As the information needed to track the KPIs is often stored in databases, CRMs, ERPs, etc., businesses must integrate their KPI Tracking System into internal systems. Once the KPI Tracking System collects the necessary information, it creates charts and graphs that illustrate changes in the KPIs in real time. Businesses can also integrate their KPI Tracking Systems into dashboards that compare current and historical states to get a better understanding of the current business performance.
Talking about understanding, let’s understand the types of KPI Tracking Systems!
Types Of KPI Tracking Systems
While some KPIs are critical in measuring the weekly progress of a goal, others can be important in the long term. However, one thing all KPIs have in common is that they’re tied to business goals. Here’s an overview of the types of KPI Tracking Systems, based on the common types of KPIs they track:
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Strategic
This tracks big-picture KPIs that help monitor the long-term organizational goals. Executives typically look to strategic KPIs to find out how the organization is doing at any given time compared to the past. Examples include return on investment, revenue, market share, etc.
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Operational
The KPIs tracked here typically measure the business performance in a shorter time frame. This helps managers and business leaders make decisions related to organizational processes and efficiencies. Examples include monthly sales, average monthly transportation costs, cost per acquisition (CPA), etc.
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Functional
These track KPIs tied to specific functions. For instance, IT teams might track the average time needed to resolve an issue or average uptime, while finance teams may track gross profit margin or monthly return on assets. However, functional KPIs can also be classified as strategic or operational, depending on the time duration.
With that, we come to the section you’ve been waiting for – the one that will answer, “Do I really need KPI Tracking Systems?”
Benefits Of KPI Tracking System
After all, with such comprehensive coverage of business metrics, performance and outcomes, you definitely need a KPI Tracking System. In fact, it brings along several benefits, such as:

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Assessing Number-driven Strategies
Tracking KPIs related to sales, marketing, finance, etc., helps business leaders assess how effective they are in number-driven strategies. For instance, comparing lead conversion rates from digital vs on-premises channels for a retail business can help them choose whether they need to refine their digital marketing strategies.
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Choosing Targets Based On Historical Trends
Analyzing historical KPI data can help businesses in identifying areas of opportunities as they reveal changes over time in specific metrics. For instance, it can help in identifying customer behavior trends by recognizing a consistent increase in the sales KPIs in a particular region during a specific time of the year. This can prompt increased investment in that market as an area of investment.
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Measuring Progress Towards Business Goals
Leveraging KPI data can help measure progress towards specific company, departmental or individual goals. It can also help break down larger goals into smaller, manageable parts and adjust the strategies as needed. For instance, if the goal is a 150% increase in sales revenue in a year, using a KPI Tracking System to monitor the monthly revenue can inform when changes to the sales strategy are needed throughout the year.
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Planning For Future Growth
Utilizing historical KPI data can also help in modeling past growth to plan for the future. Combining historical KPI models with industry forecasts, job outlooks and other market data can provide insights for future planning. For instance, insights from historical KPI models can help anticipate if plan expansions, hiring, etc., are on track or need adjusting.
Yet, using historical KPIs to understand present-day KPIs isn’t the best part – it’s what is yet to come!
Future Trends In KPI Tracking Systems
In the near future, we believe KPI Tracking Systems are poised for a major transformative enhancement. Soon, artificial intelligence integrations will lead to more promising predictive analytics, offering insights that go beyond analyzing historical data. Moreover, real-time tracking of KPIs will become even more prevalent, enabling quick decision-making in boardrooms across industries.
That’s not all, blockchain technology is expected to enhance the security and transparency of business data, ensuring no tampering or modification of enterprise information happens. After all, you remember how accurate business data leads to accurate KPI tracking, right?
Furthermore, customizable and user-friendly interfaces will soon empower a broader spectrum of users to harness the benefits of KPI tracking. With more user-friendly KPI Tracking Systems, making data-driven decisions will become an integral part of the day-to-day business workflow. We’re all in for that!
Conclusion

In a modern workplace, KPI tracking plays a vital role. It guides the efforts to fine-tune, align and improve the day-to-day organizational processes to ensure success. By monitoring Key Performance Indicators in real time, stakeholders can easily identify areas of improvement and make data-driven decisions. Moreover, with KPI Tracking Systems, business leaders can understand business health, workforce performance, resource allocation, growth and other metrics that can make or break a business. So, have you opted for a KPI Tracking System yet?
Frequently Asked Questions
What Is KPI Tracking And Why Is It Important For Businesses?
KPI tracking involves monitoring performance metrics to analyze and improve business operations. It helps evaluate the effectiveness of operational changes and guides decision-making by providing data-backed insights.
How Do KPI Tracking Systems Work?
KPI Tracking Systems establish goals, ensure accurate data recording, identify critical KPIs, integrate with business apps, and provide real-time analysis through dashboards. This process enables businesses to monitor performance metrics effectively.
What Are The Benefits Of Implementing A KPI Tracking System?
Implementing a KPI Tracking System allows businesses to assess strategies, set targets based on historical trends, measure progress towards goals, plan for future growth and make data-driven decisions. It empowers stakeholders to understand business health, workforce performance, resource allocation and growth.
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