Which practice involves measuring organizational performance against defined targets?

The concept of Key Performance Indicators (KPIs) is central to measuring organizational performance against defined targets. KPIs are specific, quantifiable metrics that are used to evaluate the success of an organization in achieving its strategic and operational objectives. They provide a focus for strategic and operational improvement, create an analytical basis for decision making, and help to focus attention on what matters most to the organization.

KPIs are typically aligned with the goals and objectives of the organization, ensuring that progress is measurable and aligned with the desired outcomes. They help organizations to gauge their performance over time and against their competitors, allowing for benchmarking and performance comparisons.

In contrast, while Outcome Measurement is related to evaluating results, it does not necessarily involve the establishment of specific targets against which performance is measured. Performance Assessment can encompass a broader range of evaluations and may include qualitative measures, while Data Reporting refers to the process of distributing information without necessarily tying it to specific performance targets or evaluations. Thus, KPIs distinctly provide a structured approach to measuring organizational performance against predefined targets, making them the most relevant choice in this context.