KPI vs CPI: Building a Holistic CX Strategy
The difference between key performance indicators and customer performance indicators, with paired examples and where CSAT, NPS, CES and FCR fit.
In customer experience, CPI stands for customer performance indicator, not the consumer price index. A CPI measures an outcome the customer wants, and sits beside the KPIs a business tracks for itself. This briefing explains the difference and how to pair the two.
KPIs: what the business tracks
Plecto defines a key performance indicator as a quantitative, evergreen metric used to track business performance. In customer service, typical company-centric KPIs are average handling time and first response time [2].
CPIs: what the customer experiences
Microsoft describes customer performance indicators as measures of outcomes customers want, such as time savings, cost savings, convenience and flexibility [1]. Quirk's describes a CPI as a KPI set from the customer's point of view. For example, the time it takes to solve a problem is not the same as response time [3].
Paired examples
| Company KPI | Matching CPI |
|---|---|
| First response time | First resolution time [2] |
| Quote to close ratio | Quote turnaround time [1] |
| Product return rate | Ease of product return [1] |
Microsoft notes a strong correlation between the two: meeting a CPI's objective is likely to lift the KPIs tied to it [1].
Where CSAT, NPS, CES and FCR fit
- CSAT (customer satisfaction). Customers rate their overall satisfaction on a 1–5 scale. The score is the number of satisfied customers (4s and 5s) divided by all responses, times 100 [5].
- NPS (Net Promoter Score). Customers say how likely they are to recommend you on a 0–10 scale. Promoters score 9–10, passives 7–8 and detractors 0–6. NPS is the percentage of promoters minus the percentage of detractors [4]. Quirk's argues that NPS is not a CPI [3].
- CES (Customer Effort Score). Introduced in a 2010 Harvard Business Review study of more than 75,000 customers. The authors found it predicted loyalty better than satisfaction measures or NPS, and that customers are four times more likely to leave a service interaction disloyal than loyal [6].
- FCR (first call resolution). How often a contact centre resolves a customer's issue on the first call. SQM puts the industry average at 70% and world class at 80% or higher. Internally measured FCR tends to run 10–20% higher than what customers report [7].
The limits of CPIs
Plecto lists three drawbacks: CPIs can be too subjective, they can focus too narrowly, and they are hard to benchmark [2].
Building a balanced scorecard
- List the KPIs each team already reports.
- For each one, write down the customer outcome it is meant to serve, and measure that outcome as a CPI.
- Report each pair together. A faster first response that does not shorten time to resolution then shows up as a problem.
- Add the Customer Effort Score, which the HBR study found to predict loyalty better than CSAT or NPS [6].
Related: master the CX mindset and AI customer support agents.
Frequently asked questions
What is the difference between a KPI and a CPI?
A KPI tracks the business's own performance, such as first response time. A CPI measures the outcome the customer wants, such as how long it takes to resolve their issue.
What is a customer performance indicator?
It is a measure of an outcome customers want, such as time saved, cost saved, convenience or flexibility. It works like a KPI but is set from the customer's point of view.
What are examples of CPIs?
First resolution time, quote turnaround time and ease of product return. Each pairs with a company KPI: first response time, quote-to-close ratio and product return rate.
Is NPS a KPI or a CPI?
Quirk's argues that NPS is not a CPI. NPS measures how likely customers are to recommend you, scored as the share of promoters minus the share of detractors.
Which customer metric best predicts loyalty?
In a 2010 Harvard Business Review study of more than 75,000 customers, the Customer Effort Score predicted loyalty better than customer satisfaction measures or the Net Promoter Score.
What is a good first call resolution rate?
SQM puts the industry average at 70% and world class at 80% or higher.
Sources
- KPIs and CPIs (Dynamics 365 blog) — Microsoft (November 2021)
- CPI vs KPI — Plecto
- Forget KPIs. It's all about CPIs — Quirk's (October 2020)
- Introducing the Net Promoter System — Bain & Company (December 2011)
- What is CSAT? — Qualtrics
- Stop Trying to Delight Your Customers — Harvard Business Review (July 2010)
- How to calculate first call resolution rate — SQM Group (January 2021)