A key risk indicator (KRI) and a key performance indicator (KPI) are both measures used to assess the performance of an organization, but they have distinct differences.
A KRI is a measure that provides an early warning of potential risks and helps organizations monitor and manage risk more effectively. KRIs are designed to identify potential risks before they materialize, so that organizations can take proactive steps to mitigate them. KRIs are typically quantitative measures that can be easily monitored and compared to predetermined thresholds. Examples of KRIs include changes in sales or market share, or changes in the number of customer complaints.
A KPI, on the other hand, is a measure that is used to assess the performance of an organization against its strategic goals and objectives. KPIs are designed to track progress towards specific goals and help organizations understand how well they are performing. KPIs are typically quantitative measures that can be easily monitored and compared to predetermined targets. Examples of KPIs include measures of customer satisfaction, employee engagement, and financial performance.
In summary, while both KRIs and KPIs are measures used to assess performance, KRIs are focused on identifying and mitigating risks, while KPIs are focused on tracking progress towards specific goals and objectives. By using a combination of KRIs and KPIs, organizations can have a complete understanding of their performance and the risks they face.
