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Key Performance Indicators (KPI) by Bernard Marr

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9

Return on investment (ROI)

Strategic perspective

Financial perspective

Key performance question this indicator helps to answer

How well are we generating sustainable profits?

Why is this indicator important?

Return on investment (ROI), also referred to as the rate of return or rate of profit, is a financial performance measure that is used to evaluate the efficiency of an investment (after or during the investment period) or to compare the efficiency of a number of different investments (before capital is allocated).

ROI is a calculation of the most tangible financial gains or benefits that can be expected from a project versus the costs for implementing the suggested programme or solution. In short, it is the ratio of money gained or ...

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