Are Your Metrics Aligned to Your Strategy?

It is a basic premise of human conditioning that we are more likely to repeat behaviours that are rewarded.
Not just humans, this process of rewarding a desired behaviour is used to train your family dog as well as your children.
As an employer or leader in your workplace you may be occasionally (frequently?) disappointed that your staff don’t share your standards of performance, application, enthusiasm and striving toward the goals of your enterprise.
Human behaviour is not just a reflex or rewarded response, it is the final expression of beliefs and attitudes, coloured by an understanding of social situations and environmental influences. This is a complex pathway to navigate as an employer.
One of the most common strategies we use to help them focus in our business is to apply metrics – we measure stuff. And therein lies the risk.

A recent article in Harvard Business Review questions whether metrics can actually be counter-productive. The authors suggest that metrics are almost always flawed and can alter behaviours or decisions in ways that are not anticipated.
Harris & Taylor call this ‘surrogation’. A process where employees confuse your business strategy with what you are measuring in their performance.
Not just employees. Are you over the repeated requests for feedback from businesses you have used?
‘Stay on the line to complete a short survey’,
‘How many stars will you give us for our service or product?’,
‘Please score our service on this 10 point scale’

What was once a novelty and a chance to deliver feedback is now a time-consuming nuisance likely to turn customers off. Asking about their satisfaction levels is no substitute for actually delivering a satisfactory service. Yet happens when employees aspire for rating points when they should be focused on delivering a remarkable customer experience.
Are your employees measured on throughput or productivity? Are their Key Performance Indicators or remuneration triggers linked to the number of services delivered or dollars generated? Then in the staff room they see a mission statement promising to deliver excellence in health care to the local community. One objective is abstract and difficult to measure, the other is concrete and easily expressed in numbers. Employees will seek to meet the measurable metric with one eye on their upcoming performance review and the other on their pay packet. Leaving no eyes to focus on your business strategy or vision.

Two suggestions offered by the authors are –
1. Loosen the link between metrics & incentives
2. Use multiple metrics
The latter is a preferred option of mine, using a mix of quantitative metrics (e.g. earnings) alongside at least one qualitative metric (e.g. quality of clinical records or 6-week post-discharge satisfaction rating) and only paying incentives if both sections meet pre-determined targets.

Check your incentive and metrics systems and ensure they are aligned with the strategy and vision that drives you.

Harris M. & Tayler B. 2019. Don’t Let Metrics Undermine Your Business. Har Bus Rev Sep/Oct 2019 p63