The key performance indicators (KPIs) and their impact on overall organizational performance

Abstract

The concept of performance management is used by most of the organizations to ensure that either they are going on the right path or not. For managing the performance the organizations are required to know about the performance indicators. This paper explores the key performance indicators (KPIs) and impact of these KPIs on the overall organizational performance in manufacturing sector in Pakistan. The data for present study collected from the top level management of the 84 best manufacturing organizations in Pakistan by using a structured questionnaire and the impact of KPIs on the overall performance of the manufacturing organizations were evaluated. The results show that the manufacturing organizations put more focus on the customer satisfaction and Delivery reliability in terms of performance measurement. And measuring the performance in terms of cost, financial, quality, time, flexibility, delivery reliability, safety, customer satisfaction, employees’ satisfaction and social performance indicators have positive significant impact on the overall organization’s performance. This paper puts together all important performance indicators used by organizations in a single list and check their impact on the overall performance indicator index of the Organizations. As Pakistan is among the developing countries, this study will serve as a valuable guideline for several manufacturing organizations operating in other developing countries of the world.