I am reading some book about strategic management.

First, I must tell you that my native language is not English.

My question is:

In the book, they divided Key Performance Indicators into three groups:

1) indicators of competence (or indicators of competency)

2) indicators of profitability

3) indicators of effectiveness (or indicators of efficiency)

Did someone heard about this distribution (division) of KPIs and what is the exactly translation of indicators?

I gave my best to translate correctly on English. If somebody heard of this division could you write the name of the books or articles on English where can I further read about it.


1 Answer 1


Key Performance Indicators are important elements of a company that can be used to asess a firm's current core competencies and business model. They are based on of key result areas. Here is my interpretation of the three indicators and some examples (There are many more):

  • Competency: A firm's business strategy and it's competitive advantage
    • Example: Retention, Value (Quality/Price), R&D Investment
  • Profitability: A overall indicator of market performance
    • Example: ROI, Gross Margin, EBITDA
  • Effectiveness: The implementation of a firm's strategy
    • Example: Market Share, Sales, New Market Segments

You may notice that the examples can be related to other indicators, because the indicators are a broad overview of the firm.

  • $\begingroup$ Do you know some book where can I read about indicators of effectiveness $\endgroup$ Commented Mar 27, 2016 at 1:08
  • $\begingroup$ Sadly, I don't have one that's electronic for you to reference but I do have a paperback one (it has no ebook to it) that I can use to send you a photo of information on KPI's $\endgroup$
    – David Ta
    Commented Apr 6, 2016 at 5:03

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