Key result areas (KRAs)
What is a key result area?
Key result areas (KRAs) are specific, critical domains of an employee’s job or a business process that are essential to achieving the overall objectives and success of an organisation. KRAs outline what is expected from a role or a function in clear terms, providing focus for performance measurement and professional growth.
Key takeaways
Focused performance metric
KRAs identify the most critical areas where outcomes must be achieved for a role or department to contribute effectively to the organisation’s mission.
Clarity of responsibility
Each KRA is linked to a set of tasks or responsibilities, making it clear what an employee or team is accountable for.
Alignment with strategy
KRAs align individual or departmental efforts with broader organisational goals, ensuring that every role adds value to the overall success.
Basis for appraisal
They serve as a foundation for monitoring performance, setting targets, and conducting appraisals.
Why key result areas matter?
KRAs simplify performance management by providing clarity and focus to both employees and managers. By zeroing in on the most crucial outputs, KRAs help teams align with the organisation’s priorities and ensure resources are directed towards the most impactful tasks. This alignment not only increases productivity and motivation but also aids in transparent and fair performance evaluation.
The KRA setting process
Role analysis
Identify the core responsibilities of the job or function.
Stakeholder consultation
Managers and employees discuss expectations in alignment with organisational goals.
KRA definition
Clearly define 3-7 key areas that will be central to performance, focusing on outcomes rather than just tasks.
Documentation
KRAs are documented in job descriptions or performance management systems.
Periodic review
Regularly revisit and update KRAs based on changing objectives or role requirements.
Impact on performance management
KRAs are directly linked to the performance appraisal process. They provide measurable criteria against which actual results can be compared, making evaluations objective and transparent. Well-defined KRAs also help in identifying skill gaps, training needs, and areas for professional development.
Real-world examples
Case study: Sales manager
A sales manager’s KRAs might include:
Achieving quarterly sales targets
Expanding the customer base by a specified percentage
Maintaining customer satisfaction scores above a set threshold
Ensuring timely reporting and data accuracy
Disclaimer: The information provided in this business glossary is for educational purposes only and should not be considered as financial advice. Always consult with qualified financial professionals before making investment decisions.
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Table of Contents
Key result areas (KRAs)
What is a key result area?
Key result areas (KRAs) are specific, critical domains of an employee’s job or a business process that are essential to achieving the overall objectives and success of an organisation. KRAs outline what is expected from a role or a function in clear terms, providing focus for performance measurement and professional growth.
Key takeaways
Focused performance metric
KRAs identify the most critical areas where outcomes must be achieved for a role or department to contribute effectively to the organisation’s mission.
Clarity of responsibility
Each KRA is linked to a set of tasks or responsibilities, making it clear what an employee or team is accountable for.
Alignment with strategy
KRAs align individual or departmental efforts with broader organisational goals, ensuring that every role adds value to the overall success.
Basis for appraisal
They serve as a foundation for monitoring performance, setting targets, and conducting appraisals.
Why key result areas matter?
KRAs simplify performance management by providing clarity and focus to both employees and managers. By zeroing in on the most crucial outputs, KRAs help teams align with the organisation’s priorities and ensure resources are directed towards the most impactful tasks. This alignment not only increases productivity and motivation but also aids in transparent and fair performance evaluation.
The KRA setting process
Role analysis
Identify the core responsibilities of the job or function.
Stakeholder consultation
Managers and employees discuss expectations in alignment with organisational goals.
KRA definition
Clearly define 3-7 key areas that will be central to performance, focusing on outcomes rather than just tasks.
Documentation
KRAs are documented in job descriptions or performance management systems.
Periodic review
Regularly revisit and update KRAs based on changing objectives or role requirements.
Impact on performance management
KRAs are directly linked to the performance appraisal process. They provide measurable criteria against which actual results can be compared, making evaluations objective and transparent. Well-defined KRAs also help in identifying skill gaps, training needs, and areas for professional development.
Real-world examples
Case study: Sales manager
A sales manager’s KRAs might include:
Achieving quarterly sales targets
Expanding the customer base by a specified percentage
Maintaining customer satisfaction scores above a set threshold
Ensuring timely reporting and data accuracy
Disclaimer: The information provided in this business glossary is for educational purposes only and should not be considered as financial advice. Always consult with qualified financial professionals before making investment decisions.
Get paid globally. Keep more of it.
No FX markups. No GST. Funds in 1 day.