What are KRAs & KPIs? Business Ideas & Startup concepts explained by Alok Kejriwal

Welcome to Dhande ki baat. Dhande ki baat welcomes you! Today we are going to talk about the ‘K’ alphabet
in A-Z series. K for KRA and KPI. Now, when you hear this word you
get all worried that Alok is going to talk about something high-tech.
Not at all. KRA means Key Result Area and KPI means Key Performance Indicator. Now, where do we use this KRA and KPI? See, when you hire someone; when you
get someone and make them an employee or a consultant, there
has to be a way to measure what they do and how efficiently they do it. Right? So, for example, if I have hired any sales
member and said “Boss, your job is to sell.” That is a key result area. But how much to sell, how much
percentage you should increase the sales by, that is a KPI
or Key Performance Indicator. These two are very very important
in my opinion in any company, in any startup, in any business you do. Because, when you hire people and
when you keep people, there is an understanding between the employer
and an employee that you have to do this work.
But, very often, it is not understood. When you hire someone you say
something, 2 months later, you keep writing emails to everybody
and say, do this also and that also. The employee gets confused. In the end, at the time of appraisal,
you find out, Sir my KRA was something else and I was assigned something else.
And it is very unfair. So, I think KRA and KPI are a very fair, equitable
way of measuring, recording and making sure that both the parties are
on the same path as far as what they had hired each other to do. See, we have to also remember, an employee
hires an employer, as much as an employer hires an employee. So, just a little more detail, in KRA,
you also have to write the detail. So for example, if I say you have to
increase your sale, that is not enough. You have to also say “Boss you have to
increase your sale in all these 4 geographies” or “you have to focus on the western market” or “in my business, all the product managers
have to increase not the advertising revenue but in-app revenue”. That is a very important KRA. So listen, if I say increase revenue that
is a broad context, but if I say increase revenue from in-app that is
a narrow definition of a KRA. And KPI measures the KRA. For example, if you have to increase the
in-app revenue of your apps XYZ on the quarter, then at the end of the quarter, we say,
last month your revenue was 12 thousand dollars, this month it is 15 thousand dollars.
So, you have increased the in-app by 25%. So, KRA and KPI are husband-wife,
spouse, whatever you call it! A very beautiful relationship!
Keep making them clear. To write is hard work. Writing drives you crazy.
People are like, “Do this, we will see later”. NO. Discipline yourself! Sit, wait, understand
what the KRA and KPI is and then start. And if you are an employee, I
would say, don’t take any job or project unless the KRA and
KPI are absolutely carved out in stone. Thank you for watching Dhande ki baat! Keep watching and telling us
what you liked or didn’t like about this episode and program. Thank You!

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4 thoughts on “What are KRAs & KPIs? Business Ideas & Startup concepts explained by Alok Kejriwal

  1. Hi Sir,
    The simplicity in your explanation made it so clear. Have read quite a few articles about the difference n the definition. But a simple logic of "How and what" described it so well. Thanks 🙂

  2. Thanks for making that confusing thing understood in less than 5min… please keep sharing your knowledge with us.

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