KRA Full Form

The full form of the KRA is Key Result Areas. The general measurements or parameters that the organization has set for a specific position are referred to as key result areas, often abbreviated as KRAs. Read on to know how KRA is the determining factor for both employees and the company.

What is KRA Full Form?

The KRA full form is Key Result Areas. The employee’s work profile is broadly defined by key result areas (KRAs) which allows them to have a better understanding of their function. KRAs should be well-defined, quantitative and straightforward to track. It also aids employees in aligning their roles with those set by the company. KRAs are broad areas or themes on which employees are expected to focus throughout the year. KRAs are produced by a corporation or organization to evaluate the performance of their employees in a systematic and well structured manner. KRA describes the duration of a job profile and encompasses around 80% to 8% of a job’s responsibilities. They may also be used as an effective evaluation tool because they focus on their overall performance and efficacy.

Why is KRA Necessary in an Organization?

KRA is necessary in an organization 

1. KRA helps state things very clearly, such as what to do and how to make effective planning for it.

2. It showcases how the Performance will be measured.

3. With the help of KRA, it becomes effortless to align with the Job Role and Working environment which increases productivity.

4. KRA helps to set a realistic time-bound based Organization’s business plans.

5. It helps to look and access into the critical roles and responsibilities in various sections of the Organization.

6. KRA provides fair and unbiased performance reviews of the Employee work.

7. KRA helps to hire the right employee who can fulfill the organization’s needs.

8. KRA maintains the intuitive records and metrics for working for the Goal of the Organization.

How to Write KRAs?

KRA should be formatted in the specific structure so that the process of evaluation becomes clear. While writing a KRA, the are few things to keep in mind which are given as below:

1. Since these are based on the specific job descriptions, go through the JD of the employee thoroughly. Discuss with their manager if need arises.
2. Mark out exactly what the employee is supposed to achieve and how they would contribute to the organization’s progress overall.
3. Make a point of all measurable critical responsibilities to be carried out on the job. These include various  things that can be measured in numbers, percentages etc.
4. Set the goals based on these assigned responsibilities and write self-explanatory descriptions of every goal.
5. When describing these goals, ensure that measurable and realistic targets and timeframes are set that can be achieved.
6. After having a large goal, make smaller targets that can be achieved easily and add on to achieving something big.

How Are Performance Reviews Conducted?

Timely reviews can contribute to improving an employee’s performance. The shorter the period between reviews, the better the performance can be. Performance reviews are generally conducted on a monthly, quarterly, half-yearly or annual basis, based on the policy of the company. Keeping track of every employee’s review cycle can be tricky and a time-taking task. Managing these via email and setting reminders is time-consuming which can result in further complications.

To solve this issue and make performance reviews easier to conduct, the performance management systems were introduced. With a performance management system, one can automate the entire process of reviewing. Review cycles can be customized and created as per policies and the requirement basis of the company. These systems also provide the company with feedback forms and generate reports and graphical analysis of the review. Performance reviews provide the analysis, loopholes and the segment that needs to be focussed. 

Difference Between KRI and KRA

KPI focuses on the performance of the whole organization and the employee whereas KRA focuses on the significant performance of the employee and teams. However, KRI and KRA are dependent and are interlinked with each other. By keeping an account of employees performance, the authority decides and has maximum clarity about the employees responsibilities. KRA acts as a performance indicator to employees in regard to employees. Understanding the roles and responsibilities of employees will help the company achieve its KPI. Also, if the KPI of the company is well defined and structured, it becomes easier for the employees to understand the roles and responsibilities in an efficient way. In the matrix, the higher level of KPI and KRA depicts the success of an organization.

Benefits of KRA

In a corporate setup or in any company, the KRA has numerous benefits. If a company has well-defined KRA setup, then there are numerous benefits which are mentioned below:

• KRA allows each job role to be linked to corporate strategy

• KRA defines and set the structure of organizational alignment from top to bottom

• KRA allows in setting clear goals for the employees

• Through KRA, coaching and counseling based on the need can be done in the company

• The KRA indicates and showcases the regular measurement of results which is mostly based on performance indicator

• During appraisal, it becomes essential to see Key performing areas

Employees Key Performance Indicators

To find out the KPA of employees, few points are taken into consideration. The parameters are based on several set benchmarks in the company. Few of the aspects on which KPA are mentioned are:

• Teamwork
• Communication skill
• Customer Service
• Job Functions
• Job performance
• Task execution
• Deadline submission
• Friendliness
• Ability to finish task on time
• Ability to work under pressure

Different KPI metrics such as the revenue generated per employee, employee billable percentage, average task completion rate, overtime per employee and many more can be calculated, monitored and assessed to find out the financial aspects related to the workplace. 

Types of Key Performance Indicators

Every institution has different key performance indicators on which the employee's KRA is accessed. When it comes to a specific organization, then profit making is the most crucial metric to measure the success or failure status, over a period of time. Taking the motive of ‘profit’ of the company/institution into consideration, few of the parameters are:

• Revenue Growth
• Income Sources
• Profitability over time
• Working Capital
• Client Servicing

Any negative growth on the parameters becomes the point of attention for the company. The main focus lies on improving the growth, increasing the profitability through these metrics to improve the growth of the organization.