3 Traps of KPIs You Didn’t Design Yourself

by Stacey Barr

One of the shortcuts we take with performance measurement is to adopt KPIs that already exist somewhere. But these shortcuts come with traps.

Mouse trap representing that there are unavoidable traps in adopting other organisations' KPIs. Credit: https://www.istockphoto.com/portfolio/AlexLMX

Take a moment to reflect on how your organisation chooses its KPIs:

  • Do you go looking for measures that your organisation or team can adopt?
  • Do you trawl through the annual reports of organisations in your industry?
  • Do you survey your colleagues at industry conferences, do you search for KPIs in your industry on the internet?
  • Do you ask the so-called experts what measures you should be using?

Are these your only strategies for finding the most meaningful measures for your goals? Yes? Oops! You’re probably about to take a tumble into one of the following 3 traps:

The “how-do-I-actually-measure-this” trap.

You’ve got your list of KPIs that you hunted and gathered from various sources, and now you want to start implementing them.

Only the information you have about them is too thin and you can’t figure out how it should be calculated and what kind of data to use and how frequently to measure it! In fact, the more you think about those measures, the more confused you are about what they actually mean.

What are your chances of getting these measures implemented successfully? Buckley’s.

The “why-aren’t-my-staff-buying-in-to-these-measures” trap.

It’s still true that KPI review is not everyone’s favourite task to turn to when some free time comes up.

Most organisations that are starting out with measurement really don’t have a healthy measurement culture, where people are all about using measures as feedback for ongoing business improvement. Handing them “these measures we prepared earlier” feels to them like you’re handing them the stick you’re about to bop them on the head with.

And you want them to happily and cheerfully own and use these measures? Good luck with that.

The “hang-on-these-measures-don’t-match-our-goals” trap.

Adopt someone else’s KPIs and you’re adopting their strategy.

Did you know that some organisations treat their performance measures as part of their intellectual property and competitive advantage, and refuse to let anyone outside the organisation know what they are? There’s a good reason for this. Measures (when they are well designed) tell the complete story of an organisation’s direction and journey in that direction. They give knowledge to the leaders and decision makers that is priceless, and this is possible because those measures were designed very specifically to match the organisation’s unique goals and strategic direction.

You want measures to match what really matters about your unique organisation, right? Unique organisation = unique set of KPIs.

It’s faster and easier to design KPIs yourself!

The key: know and understand your goals, and design the right measures that are the best evidence of your goals. There are no shortcuts without traps.

But there are ways to make the measure design process easier, faster and more meaningful. In the long run, designing the right measures yourself is going to save your time and effort.

Searching around for KPI ideas is not the real problem. In fact, it’s a good idea to help you build your list of potential measures. But not until you first understand the results you are most needing to measure, so you have a sensible filter to discard potential measures that really aren’t right for you and to keep the measures that make the most sense to your strategy, and to your team.

There are unavoidable traps in adopting other organisations’ KPIs. Each organisation is unique, and needs a unique set of KPIs. [tweet this]

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