Useful Metrics for Evaluating Employee Performance in 2025

Your star performer just quit without warning. Your “reliable” employee missed another crucial deadline. Your team’s productivity feels like a mystery box—some days great, others… not so much.

Sound familiar? You’re not alone. Most organizations are flying blind when it comes to truly understanding employee performance. Traditional annual reviews? They’re about as effective as using a sundial to time a race.

But here’s the thing: companies that crack the code on modern performance measurement keep their top talent, spot problems before they explode, and build teams that actually want to show up every day.

Ready? Let’s uncover updated metrics for evaluating employee performance in 2025.

TL;DR – key takeaways

✅ Only 23% of employees worldwide are engaged at work, costing the global economy $8.9 trillion annually in lost productivity, according to Gallup.

✅ The top 10 metrics for 2025 include goal achievement rates, digital collaboration effectiveness, AI tool proficiency, employee wellbeing indicators, and remote work productivity. These are supported by current trends and expert recommendations.

✅ Traditional performance reviews are failing: 95% of HR leaders are dissatisfied with current review systems, according to Gartner. These are described as outdated, ineffective, and a source of employee disengagement.

✅ AI adoption is crucial: 72% of business leaders report high productivity gains from extensive AI integration in a McKinsey study.

Why measure performance metrics?

The traditional model of annual performance reviews is dead. The vast majority of HR leaders are dissatisfied with current review systems, while most workers see performance reviews as “a complete waste of time that doesn’t help them perform better”.

The stakes couldn’t be higher. Employee disengagement costs the global economy $8.9 trillion annually in lost productivity (Gallup). Meanwhile, companies that continuously update and measure employee performance metrics achieve business goals faster. Such organizations achieve significantly lower turnover rates, higher ROI on performance investments, and dramatically improved employee engagement.

Benefits for companies:

• Make strategic resource allocation, as performance metrics reveal where human capital investments generate the highest returns.
• Reduce costly turnover by identifying and addressing issues before your employees quit.
• Boost team performance through clear expectations and targeted development.
• Leverage regular performance evaluations to identify strengths and areas for improvement in employees’ performance, supporting better decision-making and growth.
• Make smarter hiring decisions by understanding what drives performance with both qualitative and quantitative metrics.
• Increase ROI on training and development programs.

Benefits for employees:

• Get a clear direction on what success looks like in their role and frameworks for employees’ efficiency.
• Receive regular feedback instead of waiting for annual surprises like the average performance review rating.
• Accelerate career growth through targeted skill development and a clear understanding of how to complete tasks.
• Enhance personal and professional development by understanding an employee’s ability and tracking the employee’s productivity and work quality.
• Feel valued and heard through ongoing performance conversations and satisfaction surveys.

The message is clear: choosing the right performance metrics to track helps your company dominate in a competitive market, rather than just survive. Measuring employees’ work and productivity provides actionable insights for continuous improvement.

📍 Important note: Don’t get overwhelmed by trying to track every possible metric at once. Start with 3-4 key metrics that match your biggest challenges, then expand gradually. I’ve written a complete guide on how to track employee performance.

Performance measurement frameworks

A robust performance framework is no longer a “nice-to-have”, but a must for any organization aiming for sustainable success. These frameworks are a structured, repeatable approach to quantify employee performance, so you can ensure that every individual’s efforts are aligned with broader business objectives.

What sets the best frameworks apart? They actively involve employees in the goal-setting process, encourage regular feedback and coaching, and empower teams to make data-driven decisions. This collaborative approach not only boosts engagement but also ensures that performance reviews are meaningful and actionable.

Some of the most effective performance management frameworks for 2025 include:

• OKR (Objectives and Key Results): Focuses on setting ambitious, measurable goals and tracking progress with clear key results.
• SMART goals: Ensures every objective is Specific, Measurable, Achievable, Relevant, and Time-bound, making it easier to assess employee performance and drive results.
• Balanced scorecard: Combines financial, customer, internal process, and learning & growth metrics to provide a comprehensive view of organizational performance.

By adopting these frameworks, you can create a culture of constant improvement, where assessing employee performance is part of everyday work, not just an annual event. The result? Better alignment, higher engagement, and a clear path to organizational success.

The 10 key employee performance metrics for 2025

Not all metrics are created equal.

While some companies get lost measuring everything from coffee consumption to keyboard clicks with intrusive time tracking, the smart ones focus on what actually moves the needle. The following 10 performance metrics are the sweet spot between quality metrics that impact business outcomes while fostering employees’ ability to grow in their careers.

Let’s get cracking with 10 employee performance metrics examples.

1. Goal achievement and OKR completion rates

Why these matter: Clear, measurable work goals are the foundation of performance evaluation. Both your team knows the key performance indicators against which they’re measured, and you have clarity on how to assess their productivity.

Plus, realistic goals with regular check-ins create momentum and motivation that annual reviews can’t match.

How to track these employee performance metrics:

• Set quarterly and annually OKR completion targets between 70 and 80% for stretch goals. In this category, you’ll include both short-term and long-term goals.
• Carry monthly milestone achievement checks in your one-on-one meetings.
• Make a goal quality assessment. You can use the SMART goals criteria to measure employee performance (specificity, measurability, and relevance).

Tools to measure employee performance:

• Use tools like Lattice to measure OKRs, or EARLY to understand how time is spent on specific goals and projects.
• Use custom dashboards in EARLY to see progress visualization.
• Hold weekly check-in surveys on goal clarity and obstacles.

Training & development:

• Goal accountability partnerships: Pair employees with accountability buddies who check in weekly on progress and obstacles.
• Goal adjustment skills: Conduct workshops or other formats, showing your team how to pivot and change goals when circumstances change without feeling like failures.
• Progress celebration systems: Train managers to recognize small wins and milestones to keep motivation throughout long projects.

Tired of guessing whether your team is truly productive?

EARLY’s free trial gives you instant visibility into goal achievement, collaboration efficiency, and performance patterns. Start tracking what matters in under 5 minutes.

Try EARLY now

2. Digital collaboration efficiency

Why it matters: Digital tools are determining both employee performance and your organizational success.

An employee’s ability to collaborate digitally in remote and hybrid setups either creates bottlenecks, missed deadlines, and frustration or progress on projects. So, it’s important to measure how they’re collaborating, as well as whether the tools involved are helping with this purpose.

How to track this employee performance metric:

• Assess digital tool adoption rates. These can be easily found through platform usage analytics.
• Count successful cross-team collaboration projects per quarter, and determine if these are accomplished.
• Monitor average response times only for the client-facing roles, as this is an indicator of customer satisfaction or the opposite.

Tools to measure employee performance:

• Slack/Teams analytics to identify communication patterns and usage.
• Meeting engagement tools like Otter.ai to evaluate participation tracking.

Training & development:

• Virtual communication best practices: Train on video call etiquette, asynchronous communication, and digital body language.
• Remote facilitation skills: Teach employees how to lead effective virtual meetings and workshops.
• Cross-cultural digital communication: For global teams working across time zones and cultures.

3. AI tool adoption and proficiency

Why it matters: AI isn’t coming for our jobs, but it sure comes for tasks, and ignoring AI tools is no longer an option. Again, not because they steal jobs, but because they help both your company and team stay competitive in a fast-paced market.

So, learning how to handle and incorporate AI in their jobs contributes to employee development, and you need to keep up with offering them the needed tool stack.

📍 Important note: We’re all globally just tipping the iceberg with implementing and improving at AI. Don’t make this one of the hard employee performance metrics. 😉

How to track these employee performance metrics:

• Ask your team to document creative AI applications they use in solving work challenges.
• Establish AI innovation showcases where your teams could present creative solutions they’ve developed using AI.
• Create monthly AI impact reports where employees document time saved and quality improvements.

Tools to measure employee performance:

• AI platform usage analytics (ChatGPT, Claude, Copilot, Perplexity AI usage logs)
• Before/after employee productivity comparisons, or AI-assisted task completion time tracking

Training & development:

• AI literacy bootcamps: Fundamental understanding of AI capabilities and limitations.
• Prompt engineering skills: With AI, the most critical aspect is prompting it to get the desired outputs. Once they know how to use it, the employees’ performance will increase considerably.
• Tool-specific training: Hands-on workshops for ChatGPT, Claude, Copilot, and industry-specific AI tools

4. Remote work productivity and self-management

Why it matters: Remote work separates the self-motivated from the micromanagement-dependent. Some people flourish with freedom, others flounder without structure. Knowing who thrives remotely helps you make smart staffing decisions and avoid the productivity pitfalls that sink remote teams.

How to track these employee performance metrics:

• Compare task completion rates between remote and office work settings to analyze patterns. Additionally, tracking the amount of time an employee works and how efficiently an employee completes tasks can provide deeper insights into remote work productivity and employee efficiency.
• Carry monthly self-management assessments covering time management, deep work abilities, and focus.
• Survey work-life balance satisfaction and boundary-setting effectiveness.

📍 Important note: It’s best to stay away from monitoring consistent digital presence or response time patterns. These are surveillance measures rather than employee performance metrics. Also, if someone does their tasks, but it’s not present online all the time, kudos for them, they’re efficient, and they don’t even need 8 hours to stay glued to the desk.

Tools to measure performance:

• Automatic time-tracking software with productivity insights (EARLY) so you can spot patterns of work against business objectives.
• Self-assessment on remote work effectiveness and time management skills.
• Project completion rate comparisons

Training & development:

• Digital wellness education: Workshops on screen time, preventing burnout, and maintaining mental health when working from home.
• Asynchronous work skills: Training on effective async communication and workflow management, or making a time management plan.

On the EARLY blog, there are plenty of resources on time management that could help:

• What is poor time management, and how to tackle it
• Free time management templates
• Employee productivity vs. hours worked, and why less is more

5. Employee well-being and mental health indicators

Why it matters: Because, according to the Society for Human Resource Management (SHRM), 44% of surveyed U.S. employees feel burned out at work, 45% feel “emotionally drained” from their work, and 51% feel “used up” at the end of the workday.

Burnout is on the rise, and you need to stay on top of it as if it were a performance metric. Yes, it’s not officially adopted within companies, as it supposedly doesn’t impact organizational performance, but it brings invisible costs. Why? Because stressed and tired employees make costly mistakes, take more sick days, and infect team morale.

So, tracking well-being isn’t touchy-feely HR fluff. It’s business intelligence that prevents expensive talent disasters.

How to track these employee performance metrics:

• Send stress-level pulse surveys with anonymous feedback regularly to your employees.
• Just ask the question of “how you’re feeling at work?” in your one-on-ones.
• Identify burnout risk indicators through workload and engagement pattern analysis.

Tools to track employee performance:

• Employee wellbeing platforms (Lyra Health, BetterUp)
• Pulse survey tools with wellbeing modules
• EAP (Employee Assistance Program) usage analytics

Training & development:

• Stress management workshops: Bring in professionals to teach your team coping strategies, mindfulness, and resilience building.
• Work-life balance education: Boundary setting, time management, and how to protect their energy.
• Peer support network training: Oftentimes, employees feel like they’re alone with a mission, so having a buddy or a mentor can impact their mental health.

6. Quality of work

Why it matters: An employee performance evaluation would not be complete without measuring the quality metrics. Of course, in tracking employee performance, the number of units produced is important, but it needs to be balanced with their quality.

A poor quality of work creates a ripple effect of problems, frustrated customers, and team members who have to clean up the mess. Tracking completed tasks and assessing an employee’s effectiveness in delivering high-quality work are essential for a comprehensive evaluation of performance.

How to track this work efficiency metric:

• Carry out peer review sessions with structured quality scorecards for major deliverables
• Measure first-time approval rates for projects and deliverables
• Monitor customer feedback specifically related to work quality and attention to detail, ETAs for customer-facing roles, and other metrics.

Tools to track employee performance:

• Quality management systems with built-in scorecards and rubrics
• Peer review platforms with structured feedback mechanisms
• Customer feedback systems focused on work quality metrics

Training & development:

• Quality self-assessment skills development: Teach employees to critically evaluate their own work before submission.
• Peer review facilitation: Train employees to give and receive constructive quality feedback.
• KYC (know your customer training): Help employees understand what quality means from the customer’s perspective.

7. Revenue per employee and economic impact

Why it matters: At the end of the day, every salary is paid from revenue generated. Employees who directly contribute to the bottom line become indispensable, while those who don’t risk being seen as cost centers.

So, understanding individual revenue impact is one of the critical employee performance metrics you need to use in your evaluation.

How to track these employee performance metrics:

• Calculate individual revenue contribution through an employee’s sales performance metrics. Tracking the number of sales is a key metric to assess sales employees’ performance, especially in roles where sales volume is a primary indicator of success.
• Measure human capital ROI by simply tracking project ROI and revenue impact from employee-led initiatives. When calculating Human Capital ROI, operating expenses are subtracted from revenue to determine the true return on investment in your workforce.
• Monitor client retention rates tied to specific employee relationships

Tools to measure performance:

• CRM systems with revenue attribution tracking
• Financial dashboards showing individual and team revenue contributions
• Project management tools with ROI tracking capabilities

Training & development:

• Business impact awareness: Help employees understand how their role drives revenue and leads to the company’s success.
• Value articulation skills: Teach employees to quantify and communicate their economic contributions.

8. Employee engagement

Why it matters: Engaged employees show up with energy, ideas, and commitment. Satisfaction at work is one of the best key performance indicators (KPIs), as it often leads to productivity and sticking to organizational objectives.

Also, the difference isn’t just performance, but engaged employees become your best recruiters, problem-solvers, and culture carriers. Effective engagement strategies can also motivate employees to achieve higher levels of performance and satisfaction.

How to track this performance metric:

• Send monthly pulse surveys measuring enthusiasm, commitment, and workplace satisfaction
• Monitor voluntary participation in company initiatives, training, and team activities
• Track employee Net Promoter Scores( NPS), asking how likely they are to recommend the workplace
• Assess emotional connection through stay interview feedback and career aspiration discussions

Tools to measure employee performance:

• Employee engagement platforms with real-time pulse survey capabilities, or simple anonymous feedback systems for honest engagement assessment
• 360-degree feedback systems to measure peer and manager engagement observations

9. Data-driven decision making

Why it matters: Gut feelings make expensive mistakes. Employees who can cut through noise to find actionable insights become indispensable decision-makers. Those who can’t, become victims of analysis paralysis or, worse, make confident decisions based on wrong information.

So, as data literacy is a survival skill in this information age, you have to measure it through the lens of performance.

How to track this performance metric:

• Evaluate the relevance, accuracy, and impact of insights presented in reports, presentations, or meetings.
• Track the proportion of decisions made with supporting data versus those made on intuition or anecdotal evidence.
• Assess how well employees’ data-driven predictions or suggestions align with actual outcomes.

Measurement tools:

• Analytics platform usage tracking (Google Analytics, Tableau, Power BI)
• Decision outcome tracking systems
• Data literacy assessment tools

Training & development:

• Analytics tool training: Hands-on experience with relevant data platforms
• Data storytelling workshops: Communicating insights effectively to different audiences

10. Emotional intelligence and team dynamics

Why it matters: Oftentimes, technical skills get people hired, but emotional intelligence gets them promoted. The employee who can defuse tension, build trust, and even increase customer satisfaction scores within a tense call with a customer. So, not only are these vital employee metrics, but they also contribute to business growth indirectly.

How to assess employee performance:

• Record conflict resolution success rates and follow-up satisfaction surveys
• Measure team morale impact through peer feedback and team dynamic assessments
• Observe empathy in customer and peer interactions

Tools to track employee performance:

• 360-degree feedback systems focusing on soft skills
• Team dynamics and conflict resolution assessment surveys

Training & development:

• Emotional intelligence assessments: Understanding personal EQ strengths and development areas
• Active listening and empathy training: Building stronger interpersonal connections
• Conflict resolution training programs: Mediation, negotiation, and constructive confrontation techniques

Conclusion

The ten metrics I’ve explored aren’t just numbers on a dashboard but your roadmap to understanding what makes individual employees thrive and where your organization can unlock untapped potential.

Smart companies won’t track everything, but they’ll track what matters. They’ll balance work quantity metrics with quantitative employee performance metrics while recognizing that development isn’t an expense—it’s a strategic investment that pays dividends in retention, productivity, and innovation. Measuring training effectiveness is essential to ensure that development programs drive real results and contribute to organizational goals.

Your star performers are waiting to be discovered. Your hidden gems are ready to shine. The question isn’t whether you can afford to implement these metrics—it’s whether you can afford not to.