Key Result Area (KRA) Meaning & Definition

Published by MBA Skool Team, Last Updated: December 11, 2013

What is Key Result Area (KRA)?

The key result areas or KRAs is a concept on which the individual performance is measured and these are the activities which have an impact on the bottom line of the business. In general it is very difficult to measure. However a basic model explaining the KRA can be discussed as follows.

Suppose a Company’s CEO has a goal of making a profit of say 200 crore in a year. So he will break this into earnings through selling activity of financial investments etc. based on this the CMO and the CFO would set further goals for their subordinates. These subordinates may further sell goals like no of units to be sold etc for further employees down the hierarchy.

For example even providing training of adequate quality can be a KRA for a training employee. Getting certain number of units sold could be another.

The result of failure of a lower level employee is reflected in the KRA of the higher level employees.

This article has been researched & authored by the Business Concepts Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.

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