Key Takeaways
- You only need 5–9 true KPIs for effective 2026 planning.
- KPIs should connect directly to a specific financial or strategic goal.
- Too many KPIs dilute focus and slow decision-making.
- The right KPIs help you act earlier, not just analyze later.
There are plenty of numbers you could track in your Gatlin business. The question is which ones actually help you make better decisions.
Because once you decide what to pay attention to, you’re also deciding what not to put front and center.
That’s why tracking fewer, more meaningful key performance indicators (KPIs) often leads to better outcomes than tracking everything available.
So, how many KPIs should you have as you set your 2026 business goals, and how do you choose the right ones? Let’s talk about it.
What are KPIs?
A KPI is not just any number you can measure. A real KPI has three qualities:
- It’s quantifiable.
- It’s tied to a specific outcome.
- It informs decisions, not just reporting.
Think of KPIs as mile markers on a road trip. They don’t drive the car, but they do tell you if you’re getting closer to where you want to go.
Most small businesses only need 5–9 true KPIs at the leadership level. That is usually enough to spot issues early without slowing decisions.
The most important KPIs are the ones tied directly to financial outcomes, customer behavior, and operational performance.
For example, the number of table turns your restaurant sees in a night, your average transaction value, or the number of defects rejected in an assembly line.
Here’s a simple test I use with my Plymouth clients: If this number drops 10% tomorrow, would you call an emergency meeting?
If the answer is no, it’s not a KPI. It might still be useful, but it doesn’t belong at the top of the food chain.
How do I set a KPI?
Every effective KPI system starts with a clear destination. So start with the goal, then work backward.
Let’s say your long-term goal is to double profits over the next five years. That’s your destination. You’ll use KPIs to track progress along the way.
Ask these questions, working backward from your goal:
- What needs to happen operationally?
- What behaviors or actions drive that outcome?
- How do we measure progress in numbers?
Imagine your goal is to add $100,000 in new revenue over the next six months.
You determine that you’ll need to hire two new team members. Of course, each hire takes time to recruit, onboard, and become productive.
So, your KPIs are:
1. Number of qualified candidates interviewed this month
2. Time to hire
3. Training completion milestones
4. Revenue generated per new hire
Each step has a clear, objective target. That’s what effective KPIs look like.
How many KPIs should you have?
Here’s my professional opinion, after years of working with small business owners:
If you track 20 things, you’re not truly focusing on anything. So, how many KPIs should you have? Your primary dashboard should include 5 to 9 high-level KPIs total. Beyond that range, you just start skimming the data.
I recommend structuring your KPIs into four core buckets to keep things in order:
1. Financial Health (2–3)
Examples: Net profit margin, Operating cash flow, Revenue growth rate
2. Customer Success (1–2)
Examples: Customer acquisition cost (CAC), Retention or repeat rate
3. Operations & Efficiency (1–2)
Examples: Revenue per employee, Project or delivery completion rate
4. Future Growth (1–2)
Examples: Sales pipeline value, Lead conversion rate
Now, these are just ideas of KPIs you can set within each category. Your specific industry may require others to effectively reach your goals. That’s fine, just as long as you don’t set 30 of them.
A final word
Over the years, I’ve helped business owners sort through questions like this when things feel busy or unclear. You don’t need to have it all figured out before you start the conversation. If talking it through would be useful as you plan for 2026, let’s connect.
FAQs
“How do I know which numbers actually matter in my business?”
The numbers that matter most are the ones tied directly to decisions. If a number changes and it would not prompt a discussion or action, it may still be useful for reference, but it probably does not belong on your KPI list.
“How many KPIs should a small business track?”
Most small businesses are best served by tracking 5–9 high-level KPIs on their primary dashboard.
“How can I tell if a number is really a KPI?”
If a noticeable change in the number would not lead to a decision or adjustment, it does not belong at the KPI level.
“Do KPIs change as a business grows?”
Yes. As a business matures, the KPIs that matter most often change. Early-stage businesses tend to focus on stability and cash flow, while more established businesses focus more on efficiency, margin, and predictability.
“Do KPIs need to be financial?”
Not always. Many KPIs measure operations or customer behavior, but the most useful ones still connect back to financial outcomes.
“Can tracking too many KPIs be a problem?”
Yes. Tracking too many KPIs can dilute focus and make it harder to identify what actually needs attention.