What is difference between KPI and PPI?

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2026-08-17 21:40

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A few years ago I posted a new method for dealing with KPIs (Key Performance Indicators) from my years of experience in business and advocated for a different approach. Rather than individual metrics which have been traditionally used, I have used an INDEX of metrics.

Why Indexed KPIs are Critical for Business Performance and Success

http://www.r3now.com/why-indexed-kpis-are-critical-for-business-performance-and-success

Using Key Performance Indicators for Building a Strategy Focused Organization

http://www.r3now.com/using-key-performance-indicators-for-building-a-strategy-focused-organization

It would appear that SAP (http://www.sap.com) has adopted the same principals but called them different names. From an internal presentation at SAP by their Business Transformation Group.

KPI - Key Performance Indicator (discrete activity metrics and measurements)

PPI - Process Performance indicator (a process related collection of KPIs)

BPI - Business Performance indicator (a collection of the PPIs aligned to business strategy).

Enterprise Value Architecture - the key for linking Scorecards, value drivers and measurements (2011): Defining Value & Performance Drivers at the right level, pg. 15.

From what I can tell only SAP is using these terms to describe the strategic way of measuring business performance (a form of "KPI") which I have advocated.

The SAP approach, of leaving the KPI as it is understood alone, and defining two new index categories is a more refined and structured approach to achieving the same goals which I have long espoused.

Their approach, again, of using the 3 different hierarchical categories also has some alignment to the balanced scorecard approach. These categories align well with operational, tactical, and strategic business objectives.

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