Introducing Proper KPIs Where They’ve Never Been Before

by Stacey Barr

Too many performance measurement implementations fail before they start, because the purpose of measurement hasn’t been properly framed for the organisation’s current culture.

Mass of wires showing measurement needs wiring into the culture. Credit: https://www.istockphoto.com/portfolio/FactoryTh

There are many situations where we have a bunch of people new to proper KPIs, from a newly created team as part of a restructure, through to an entire organisation that hasn’t done meaningful measurement yet.

The most important consideration when introducing a proper KPI method in such situations is not the method you choose. It’s how to frame performance measurement relative to the culture of the team or
organisation.

There are several models that describe different organisational cultures, you may already subscribe to one. But we’ll use the Competing Values Framework to illustrate how to frame measurement in the context of culture. They describe four cultures:

  1. the dynamic, entrepreneurial Create Culture
  2. the people-oriented, friendly Collaborate Culture
  3. the process-oriented, structured Control Culture the
  4. results-oriented, competitive Compete Culture

Introducing proper KPIs into a Create Culture

Nothing stands still in a Create Culture. People are used to risk-taking, experimentation, and innovation. If they measure, they are likely measuring things like activity (hitting milestones) and number of new ideas generated. But there’s a good chance they don’t measure, because everything changes too quickly.

The challenge of introducing proper KPIs into the Create Culture is helping people see that their underlying business processes might be generating lots of innovations, but the processes themselves will perform best when they are well-designed and stable. And the right KPIs will help. Rather than just measuring the number of innovations, their R&D process can be improved by also measuring the ROI of innovations and the drivers of that ROI.

The catalyst for introducing proper KPIs into the Create Culture is their passion for growth and learning from failures. Position measurement as a tool that speeds up both.

Introducing proper KPIs into a Collaborate Culture

Connection among people is the priority in a Collaborate Culture. Team-work, empowerment and development of people is the standard. Measurement isn’t popular with this culture. And if there is measurement, it will feel like bureaucracy and superficiality. Not much effort or importance is given to it.

The challenge of introducing proper KPIs into the Collaborate Culture is helping people see that measurement is another valid form of information that answers a question the qualitative information cannot: how much? And when it’s done properly, teams can design measures that they feel excited about.

The catalyst for introducing proper KPIs into the Collaborate Culture is their love for collaboration and commitment to long term change. Position measurement as tool to guide continuous improvement toward those long term outcomes that really matter.

Introducing proper KPIs into a Control Culture

Hierarchy and efficiency are the drivers in a Control Culture. Everyone is expected to adhere to standard processes, policies and plans. Measurement is popular and often even formalised, but often all that’s measured is what’s easy or what’s within complete control. The important results or outcomes are often not measured.

The challenge of introducing proper KPIs into the Control Culture is helping people see that efficiency and effectiveness improve faster when results are measured, not activity. They need to believe that the results that matter are indeed measurable, when measurement is done right.

The catalyst for introducing proper KPIs into the Control Culture is their love for planning and predictability. Position measurement as a tool to achieve plans and increased predictability by being a tool in everyone’s hands, and a rod for no-one’s back.

Introducing proper KPIs into a Compete Culture

Goals, deadlines and targets make the world go round in a Compete Culture. People value focus, productivity, speed, and winning. Measurement is popular in this culture, but the KPIs generally focus on individual behaviour and hitting targets. Some thrive in this competitive environment, but often the KPIs drive the wrong behaviours.

The challenge of introducing proper KPIs into the Compete Culture is helping people see the bigger picture, the systemic nature of their organisation. In particular, to be more aware of the unintended consequences of a single-minded focus on hitting targets like they are all independent of one another.

The catalyst for introducing proper KPIs into the Compete Culture is their love for results and success. Position measurement as a tool to help them identify the real drivers of success, and how they all contribute to the results that matter for the organisation as a whole.

In general: start with the purpose of measurement, not the process.

Bringing measurement into a team or organisation new to the idea of measurement is more like wiring it into the culture, not bolting it on. Being sensitive to the culture will help that first conversation that positions measurement to trigger intrigue.

And then with that intrigue, you can use a tool like the PuMP Diagnostic to
continue the conversation, to get ideas for how measurement can be useful to them, and decide the next step.

Bringing measurement into an organisation new to the idea of measurement is more like wiring it into the culture, not bolting it on.
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