#35 The Good, The Bad, And The Ugly

There are lots of so-called “measures” that people choose to monitor business results. Some are good, some bad and some downright ugly! This is one of the most colossal mistakes I see people making with performance measures: to claim as a performance measure something that absolutely is not a measure of performance at all.

Here are three of the so-called performance measures that I really dislike most:

"win the BlahBlah Award"

The award might be a customer service award, or environmental award, or workplace health and safety award. Why do I dislike awards as measures? The winning of an award is an event, and can’t give regular, ongoing feedback that can inform decision making and improvement - to use it as evidence of business performance assumes that the criteria for the award correlate directly to the business’s priorities and strategy. And just think about the kind of behaviour and culture this kind of "measure" would encourage... everyone aiming to impress the judges of the award and taking their eyes off their real stakeholders.

"complete BlahBlah Project by June 2007"

Projects such as implementing a customer relationship management system, or upgrading a maintenance facility, or running a new employee training program are typically put in the KPI column of business plans. They are next to useless as evidence or feedback about business performance. Finishing a project by a particular date is an action, not an outcome, and thus provides no evidence whatsoever of the result that the project should have achieved. But they are the most common type of "measure". My theory is that it's because we are an activity culture - we have been duped into the false belief that as long as we do things (and finish them on time and to budget) then we have succeeded. A little more scientific thinking would go a long way: we need to use measures to test our hypotheses that the actions we have chosen in fact do produce the results we intended. So in reality, measures like these are actually strategies - the means we have chosen to achieve the results we want for our business.

"Annual BlahBlah Survey"

The survey could be an employee survey or a market survey or a community reputation survey - who knows? Irrespective, surveys are just data collection processes, not measures. The measures come from the data the survey collects and the measures must be very clearly designed and defined in order to ensure the survey collects the right data. Way too much money is wasted on surveys that ask irrelevant questions, and collect data that is never used. I guess having my foundations as a survey statistician makes me particularly frustrated by measures of this type. I'd just love to see more people demonstrating that they can discern the difference between data and measures!