What do non-financial performance indicators measure?

Non-financial performance indicators measure aspects of performance that are not directly tied to financial results. These indicators provide valuable insights into various areas of an organization, such as customer satisfaction, employee engagement, process efficiencies, and innovation. They often reflect the qualitative aspects of business operations, which can influence financial performance in the long term. By monitoring non-financial metrics, organizations can identify strengths and weaknesses, encouraging improvements that ultimately support sustainable growth and profitability.

For instance, a company might track customer satisfaction scores or employee turnover rates as indicators of how well it is performing in areas that could affect its financial success over time. Unlike traditional financial indicators, which may focus predominantly on revenue and profit metrics, non-financial indicators deliver a more holistic view of the organization’s health and operational effectiveness.