Steps To Define Key Performance Indicators(KPI's) for Data Analyst

Key Takeaways

hello all my name is krishnak and welcome to my youtube channel so guys today in this particular video i'm going to discuss about how do you derive your key performance indicators in a data analyst project the reason why i'm uploading this particular video because uh in one of the recent interviews from one of my subscriber and a student uh he was asked this two specific question how do you derive key performance indicators and the second one was which was the follow-up he got a specific fintech data set and he was given time to 30 to 45 minutes and then in that specific time they told him to come up with some amazing key performance indicators and he exceptionally performed well i had a talk to him and what all steps he basically used what the interviewer were actually looking at that same thing the entire thing i'll be explaining in this specific video right so please make sure that you watch this video till the end because this will definitely be helpful for both programming non-programming non-technical people also because non-programming and non-technical they also have lot of domain knowledge right so deriving key performance indicators i would suggest to follow four important steps the first step is define the key business goal okay here i'll also be considering a very good example so that you will be able to understand each and every step let's say that you're working an e-commerce website a company like amazon okay let's say amazon has actually started this big billion days i hope you have heard of it let's say that in the last year it was able to earn x dollars and this year they also again want to come up with a big billion day sale and their main target is to increase the sale revenue when compared to the previous year right so here precisely you know the business goal which will definitely help you to come up with some plan right your business goal is to basically increase the revenue of the entire sale so now once you are good with the with respect to the goal now let's go to the second step the second step is defining our key visuals now why i'm saying this key visuals let's say now in order to achieve that goal right sales revenue goal what all things you may be dependent on with respect to this particular use case you let's say that you have defined some successes right some some key parameters let's say the first parameter is that let's say that you want to focus more on the leads how do you increase the revenue definitely you want more leads to come and visit your website right so this is one step leads can come through various way through email marketing through organic marketing through inorganic marketing through various ways to advertisements so every key parameters that are involved in that you will try to use it together to come up with some key visuals right so here what you're doing is that you're specifically choosing the entire from the entire data set you're dividing tasks and subtasks which will lead to basically achieve the goal that you're looking for right the second the second key visual second key parameter can be something else let's say that uh you your e-commerce website is selling one specific product in tremendously and it is performing well in the market every frequently you are basically getting that particular sale and you are able to sell that particular product so for that particular product what you can do is that you can apply a discount coupon and you can give them and you can basically say that this is probably the most popular product that is available right now in amazon and you can open that as an offer so this can be the second key visual right so like this you really need to define and predefine your task and sub task and group them together right so this this all are your key parameters that you can basically use right so i hope everybody has understood about your uh second step that is defining our key visuals key visual basically means that you're just considering that which all parameters your basically key parameters you're going to use and you're thinking of a visualization diagram for that so that you can use it anywhere in your business intelligence too right now coming to the third step your third step is also very much important that is determining the measurements now in this specific step let's say that once you perform the data pre-processing right in power b and tablet you may have probably seen right as an example when i told you in the second step you define your key parameters let's say in the third step when i talk about measurements right so one example can be that what is the like how how much time a person is spending in your e-commerce website what is the kind of product they are looking at so this can be one one measurement parameter the length of the time that is basically browsing your website right what is the average duration the person is spending in your website this can be another thing what is the average duration with respect to different different products the person is spending in your website right so this can be some key measurements that can be used with respect to this specific use case one amazing thing about power bi and tableau after you do the data pre-processing and you probably convert your parameters into date time you you convert your parameter into decimal numbers numerical variables and all and once you come to the visualization part you will be able to see in the right hand side all the features which are numerical mostly for the numerical features it considers them as measurement now whenever a numerical feature is there some of the measurement functionalities like aggregate functions like mean median mode right what is the minimum what is the max value right what is the average value that all functionalities will be directly available in your power bi right through that you will be able to create some amazing graphs right so if i talk one example with respect to the products how what is the average duration the person is spending in your website right how many number of clicks is basically doing in with respect to different different products so this kind of measurements can be combined together and it will support the second step which is basically defining your visual keys so here now you will be able to create five to ten different different graphs visual graphs which will be supporting your second point and this measurement is pretty much important because this measurement will lead to the main thing that is finalizing your goal and helping your stakeholders to take the next step next action steps right now coming to the fourth and the final point that is finalizing your kpis now finalizing a kpis is very much simple guys let's say that i am putting a very generic statement saying that i want to let's say that increasing the sales revenue by 20 from the past big billion day sales so that will be my main title right now internally i will have many graphs that will support that let's say the average duration that is used average products which is the most popular product that is sold you know the discount coupons that is getting applied frequently the affiliate links that has been created who is the most popular a person who is doing this affiliate part also so all those things will be done and based on that they will decide that what kind of offers they should open and give it to the users so that the sales revenue will increase so this is the steps that was actually followed by that guy also who had actually attended the interview and he exceptionally performed well and he was able to get some amazing things from that finally he got an offer and he did absolutely well right so i hope you like this particular video also please make sure that you use this steps again don't copy and paste from a generic sales kpi ecommerce kpi or finance kpi right start thinking start with defining your key business goal define your key visuals again this terminologies can be changed by anyone that is then determining the measurements and finally finalizing your kpis so this was it from my side i hope you liked this particular video i'll see you in the next video have a great day thank you and all bye