How Much Undiluted Truth Can You Bear From KPIs?

by Stacey Barr |

Evidence-Based Leaders have a certain spirit that other leaders do not. This spirit comes from their ability to both bear and bare the undiluted truth from KPIs about what isn’t working; to have more tolerance for accurate bad news than inaccurate good news.

Wooden cubes showing switch between the words FACT and FAKE. Credit marchmeena29

The German philosopher, Friedrich Nietzsche, is quoted to have said this:

“The strength of a person’s spirit would then be measured by how much ‘truth’ he could tolerate, or more precisely, to what extent he needs to have it diluted, disguised, sweetened, muted, falsified.”

Nietzsche is talking about what my colleague, Mark Hocknell, says is a dire problem with how leaders and decision-makers seem to prefer inaccurate good news over accurate bad news:

“This propensity to want to deliver good news seems to lead us to not be clear with the results we want to make progress towards. We get vague about what we want to achieve, so that we don’t have to deal with the bad news. This also leads us to developing performance measures that are, typically, easy to produce, the counts of activity, milestones and the data we know we can get. Avoiding bad news like the plague.”

But, as innovation consultant, David Binetti, is attributed with saying, inaccurate good news is never good:

“Accurate bad news is far superior to inaccurate good news. Inaccurate good news causes us to make incredibly poor decisions that seem right at the time, but we don’t find out til much later.”

Undiluted truth is the only way to wisdom. Wisdom is the only way to solving problems we haven’t yet solved. And performance measures are one of the most powerful tools for defining and monitoring the problems we need to solve.

There is no point in looking for meaningful performance measures if we can’t tolerate undiluted truth.

If people seem to put more effort into producing inaccurate good news for performance reports than sharing accurate bad news, you have a culture that just won’t be open to better approaches to meaningful performance measurement. There won’t be enough courage to bare the truth with, or bear the truth of, KPIs.

Where does the effort go in your organisation? Do you have a high-performance culture, which values undiluted truth? Or do you have a performance-obsessed culture, which tips too often toward diluted, disguised, sweetened, muted, or falsified versions of the truth?

Sometimes it’s easy enough to see when people prefer inaccurate good news. It looks like this:

  • this month’s performance is better than last month’s (even though the net change over the last several months is for the worse)
  • KPIs get green flags because action was done and milestones completed (even though the performance result or goal, which those actions were designed to improve, has not been improved at all)
  • most of the numbers and statistics in Annual Reports
  • shifting standards to make % performance look better, like any customer rating above 5 on a 10-point scale is classed as “satisfied” (even though Net Promoter Score research suggests they must rate 8 or above before we can safely assume they have positive feelings)

But the only way that performance measures fulfill their true purpose, to help us reach our goals sooner and with less effort, is if we listen to them when they tell us accurate bad news. Like this:

  • a KPI hasn’t improved, even after large investment in a change initiative
  • the KPIs under a leader’s ownership have not reached their targets by agreed deadlines
  • a KPI is showing signals of worsening performance, and no-one currently can explain why it’s happening

There is a similar contrast I make in my book Prove It! How to Create a High-Performance Culture and Measurable Success. There is a price of being told you’re always right (that is, inaccurate good news), and that price is impotence. And there is a price of leading an organisation that performs well (which requires accurate bad news), and that price is transparency and accountability.

Which price are we more afraid of? Performance measures that give us the undiluted truth will always be resisted by people who are too afraid to pay the price of transparency and accountability.

If undiluted truth is resisted, it’s because of fear.

This fear is natural, and therefore important we have some compassion for those who feel it. That’s because it can stem from deep inside us, from what we value and believe about the world. The AVI is a values framework that I use, and it’s easy to draw some examples from its 125 values:

  • If we value achievement, the accomplishment of something noteworthy and admirable, we might fear that our KPIs show that we didn’t achieve a goal or target.
  • If we value self competence, a confidence in our skills to achieve in the world of work, we might fear that superiors will assess our competence based on what a KPI is doing (and we know that we alone don’t have control over it).
  • If we value decision and initiation, personal responsibility for acting on our conscience without external prompting, we might fear humiliation if others expect us to do what a KPI tells us to do, rather than our personal judgment. Think of any senior leader who doesn’t want to be seen to be wrong.
  • If we value (as many ambitious leaders might be) profit, accumulation of physical wealth to be secure and respected, we might fear that KPIs which track the negative consequences of pursuing profit might sabotage profit growth. Think how Gatorade would fear Tim Noakes’s research about exercise over-hydration and hyponatremia.
  • If we value efficiency and planning, to plan and implement processes and activities, we might fear that KPIs about the outcomes of our actions will influence decisions that pull resources away from us getting things done. Many governments suffer this fear, and consequently connect their budgeting process to projects and milestones rather than true outcomes.
  • If we value control and order, the control of people and things to maintain discipline and order, we might fear that KPIs about how processes are performing will threaten our belief that it’s people that need to be managed for the organisation to perform.

For all these reasons, and more, we don’t like to be accountable for performance measures. Their undiluted truth threatens our beliefs and goals.

We need the mindset of “no failure, only feedback”.

Of course, performance measures can certainly tell us accurate good news. But that only happens after we listen to the difficult truth, take ownership of it, and do what needs to be done to improve performance.

There will be some people that we won’t ever influence enough to remove their fear of the truth that KPIs can reveal. But some can be influenced. It won’t be by force or insistence; it will be by invitation. And the best invitation we can make is to reframe truth (and KPIs) as feedback, not failure. And we will need to keep making that invitation over and over again, in as many different ways as we can. The fear of undiluted truth is a very hard fear to shift.

There is no point in looking for meaningful performance measures if we can’t first tolerate undiluted truth.
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