On the one hand, Key Performance Indicators are a natural and necessary method for organizations to measure themselves and their people.
“Here are the things we care about. How did we do against those things?”
But the problem is the cat and when he gets out of the bag.
Because once you know how you’re being measured, you can easily game the system. It’s why oil companies can score high on the ESG scale, and fast food companies can score high on healthy eating initiatives, and big pharma scores well for affordable health programs.
If the help desk worker knows she’s being judged against how many tickets she closes and how fast, you gotta know that she’s closing tickets quickly and reopening new ones for the same issues. If a software developer knows he’s being judged against story points (or lines of code), you gotta know he’s inflating the points associated with his tasks (or writing extra lines of code).
That’s human nature. We optimize for what’s being measured. But optimizing isn’t the same as doing what’s best. It’s just doing what’s counted.
The fix?
First is transparency. Here are some KPI’s, but KPIs are not the only story. Impact is, and impact may be subjective. You care about the full picture, not just a scorecard.
Second, mix it up. Change the KPI’s. Reveal some after the fact.
Third, foster a culture of genuine improvement. Celebrate and encourage the innovations and attempts that didn’t work.
KPI’s aren’t the north star. Your mission is.
