Key Performance Indicators (KPIs)

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What are Key Performance Indicators (KPIs)?

Key performance indicators (KPIs) refers to quantifiable measures used to gauge the performance of a business in meeting its strategic and operational goals, especially in monitoring alliances, software-as-a-service (SaaS) platforms, and business-to-business (B2B) relationships.

Example: A manufacturing company enters into a partnership with a logistics firm to streamline its supply chain operations. They agree on several KPIs such as delivery time, cost per delivery, and percentage of on-time deliveries. These indicators help both parties to objectively measure the success of their collaboration, identify areas for improvement, and ensure that the partnership effectively contributes to the manufacturing company's broader business objectives of reducing operating costs and increasing customer satisfaction.

  • Enables tracking and measuring the success of strategic initiatives and partnerships.
  • Facilitates clear communication between partners or between departments within a business regarding performance expectations.
  • Drives decision-making and strategy adjustment based on quantifiable, data-driven insights.

Understanding key performance indicators (KPIs) helps businesses systematically manage their performance, align their strategic objectives with operational goals, and foster successful partnerships by making informed decisions and adaptations to strategies.