The Unintended Consequences of “Metrics Mania”
Last weekend, I was returning home from a business trip, and while checking out the magazines at the airport newsstand, I noticed that every other business magazine had a feature article on “Key Performance Indicators (KPI)” or “Critical Success Factors (CSF)” or some version thereof. Metrics, metrics, and metrics!
Sports is no longer a visual experience, but an endless discussion about fantasy football statistics and indicators. Sales is now being managed by closing ratios. My performance nutritionist has me tracking all meals for protein, carbs, and fat percentages! Where does it all end?
I’ve termed this, “Metrics Mania.” It is an attempt by people much smarter than me to replace judgement with numeric indicators and benchmarks based on some set of predetermined standardized data – decided by someone else. Rewards are then generated for those who meet or exceed these benchmarks. Sounds good, right? Not so fast. Here is my take on this phenomenon.
Gaming the System: Show a group of people a benchmark and they will figure out a way to “game the system” in order to achieve that metric. Groupthink will figure out the shortcut to the bonus.
Short-term behavior: Once people are incentivized by metrics, long term strategic planning goes out the window. Look at most American CEOs. Are they focused on quarterly earnings to prop up their stock price or what happens 10 or 15 years down the road?
Tracking metrics takes time: I track my meals on an IPhone app that provides me with statistical breakdown of nutrients, but it takes a lot of time to input all the data. Seems like I am always trying to find the green salad section in the app during the middle of a meal. Buzzkill!
Innovation: When your annual salary increase is based on meeting or exceeding qualitative and quantitative metrics dictated by HR, are you really going to spend time and resources working outside the box to find new and creative solutions? Probably not.
No doubt, the world of “Metrics Mania” is here to stay. We are all accountable. I just hope that while we can accept this new reality for what it is, we never lose the desire to step out to engage in good old fashioned innovation and risk-taking. And, yes, no more salads…I’ll just have the steak, please!