Key Performance Indicators (KPIs) are essential tools for a discerning business hoping to move toward its long-term goals. But which are best, qualitative or quantitative metrics?
Quantitative metrics are often directly tied to the financial happenings of your company. They are indispensable in measuring ROI (Return on Investment), providing transparent, tangible, and actionable evidence of your organization’s performance. It’s easy to track whether things are going well—at least, in terms of finances and operational efficiency—since all you have to do is check whether the numbers align with your projected ideal stats.
Cost savings and revenue growth are two crucial financial metrics a business must consider. For example, when working with an outsourcing partner, there are often significant decreases in operational expenses (since said partner should manage their staff, infrastructure, and technology) and many other costs. Revenue growth, of course, can be tracked by paying attention to sales, customer retention, and brand loyalty, verifying if and how customer experience (CX) is enhanced by CX expertise.
With quantitative metrics, you can make informed decisions based on knowledge about your organization’s bottom line – straight to the point, factual, and relevant to your company’s unique development story.
On the other hand, qualitative metrics shed light on the overall effectiveness and quality of your company’s performance – this proves extra helpful regarding things like customer experience, which can be challenging to gauge through purely numerical data.
Don’t take that to mean that qualitative data is all words, which would be difficult to process and evaluate in bulk. Qualitative data, while geared toward asking non-numerical questions, often produces easy-to-understand, concise, and vital results.
For example, customer satisfaction scores (CSAT) are measurements of customer feedback and sentiment. Rather than quantitatively assessing revenue or cost totals changes, quantitative metrics look at the real-world human impact of your business decisions.
Net Promoter Score (NPS) and brand loyalty are a couple more qualitative metrics that can take your organization from good to great, informing you how likely customers are to recommend your business to others and how likely everyone is to stick around.
Results from these metrics can still be improved by using yet another qualitative metric: First Contact Resolution (FCR). Reasonable FCR rates mean that your consumers are breezing through quick, efficient, and pleasant customer experience exchanges without having to follow up via another call or waste either side’s time.
So, the simple—if not exactly accessible—answer to our question is that qualitative and quantitative metrics are both critical. The key is gathering data smoothly and comprehensively, and correctly using the correct information.
By balancing the kinds of metrics, you can get an accurate, cohesive picture of how your organization is doing – and how it can do better. Whether taking on new hires, cutting out redundancies, or teaming up with an outsource partner, a holistic view of development gives you access to actionable insights and enables informed decisions about what comes next.
Just don’t forget that one size does not quite fit all! Your organization’s vision is unique and needs a custom strategy tailored to its needs and goals. That, in turn, means using the right tools and picking the right people for the job – and now that you know how to measure success, it should be more accessible than ever to see when you’re on the right track.