If you put a bounty on dead cobras, you may end up with more live cobras. And if you attach a big bonus to a KPI, you’ll get the same outcome in your business.
If they’re not chosen carefully, KPIs can do more harm than good. Many KPIs are one-dimensional; they’re disconnected from the real value drivers; the targets get lowballed; and (when money’s involved), they’re susceptible to gaming.
In this episode, I look at Goodhart’s Law: When a measure becomes a target, it ceases to be a good measure.
I take you through some cautionary tales, from snake breeders in British Colonial India, to phantom bank accounts at Wells Fargo, and the Qantas saga.
And I give you six simple rules for setting KPIs that drive the results you actually want.
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Links mentioned in this episode:
No Bullsh!t Leadership episode:
Wikipedia link:
Amazon link:
LBT link:
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You can connect with me at:
Website: https://www.yourceomentor.com
Facebook: https://www.facebook.com/yourceomentor
Instagram: https://www.instagram.com/yourceomentor
Linkedin: https://www.linkedin.com/in/martin-moore-075b001/
Youtube: https://www.youtube.com/@YourCEOMentor
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