Are KRA and KPI Really Different? Seeking Clarity on Their Roles and Definitions

I have been doing some research on the internet on KRA and KPI. Someone told me that KPIs are a bunch of measurements focused on Finance, Customer, Learning & Growth, Internal Business Process, and are a subset of KRAs. It's used to indicate progress of Tactical/Operational (Short term) plans.

Key Result Areas (KRAs) are a series of identified important outcomes formulated to deliver upon organizational business plans and are linked to the Strategic Plan (Intermediate/Long term).

Is the above accurate? I always have the impression that KRA and KPI are the same thing, just different terminologies.

Hi,

In very simple language, KRA (Key Result Areas) describes the roles and responsibilities a person performs in a position. KPIs (Key Performance Indicators) are the performance indicators used to prove that the defined roles are met satisfactorily. For example, for an HR Manager, KRAs will include recruitment and selection, training and development, handling employee grievances, etc.

Key Result Indicators (KRIs) for the above shall be:
- Recruitment of a new candidate in case of a new vacancy, exit, or new position should be completed within 25 man-days.
- The need for training should be properly identified before placing the person in the job.
- Employee complaints and grievances should be resolved within 7 man-days, etc.

So, KRAs and KPIs go hand in hand.

Regards,
Pooja

I know Balanced Scorecard focuses a lot on the KPI. I do not see it mentioning KRA. Does it cover KRA as well?

How long have KRA and KPI been around?

KRA and KPI have been used for a long time. Without them, appraisals in any form will not be successful. Any well-managed company will use KRA and KPI as performance evaluators and finally to check whether this position is contributing to the overall growth of the organization.

KRA (Key Result Area) is the output of an individual, section, or department that will serve as an input for another or contribute toward organizational success. It is a task or activity that must be done to ensure success (primary job responsibilities).

KPIs are quantifiable measures used to measure the critical success factors within an organization to determine the organization's performance level. KPI is a measurement or indicator that provides information on how far the company has succeeded in achieving its strategic objectives. Thus, KPIs are critical for the measurement of organizational performance.

Regards,
Durai

Instead of KRA and KPI, you may call it as KPA and KPI, i.e., Key Performance Area and Key Performance Indicator. See the attached specimen sheet to get a clear idea of KPA/KPI.