But what is a KPI?

So we teach there's four levels of KPI.

The traditional one everybody says is key performance indicators.

So performance is like how many contracts did you get signed?

That's a performance that took place.

I always say the same thing. It's like a boat going down a river. That's your business. The wake coming behind the boat. So the waves that are making, that's the performance yeah the propeller spinning in the water

Yeah, that's the process mmm so that's two sets of k-PIs performance and process so

Propeller spinning would be how many phone calls did you make how many pieces of mail did you send out

marketing money did you spend how many leads did you get yeah would be performance yeah

Profit indicator is what's our profit margin what's our revenue what's our cash conversion cycle all the

financial metrics we need to know and then we put a fourth k-pi which is a key purpose

indicator which is why does this business exist? So I give you an example.

We have a client, you know, their goal is to impact people's lives through real estate.

And so they say their purpose indicator is to impact the lives of a million people.

So we said the average of US household has 2.6 people in it.

So for every house that they buy, they count 2.6 towards their purpose indicator.

And then they're running their business on a 34% profit margin.

We know for every house we sell, we make 34% of the profit on that,

so now we know what our profit indicator is.

And we know that we need to get X amount of dollars per contract.

And so that number funnels up to the number.

Now we know what our performance indicator is and we know that if we make X number of phone calls we should get a contract.

...