Is Your Organization Ready for KPIs?
Practically every business leader reaches a point where they have to marvel at the wealth of data they’re collecting from all the software applications they’re using to run their company.
But what’s really amazing is how none of it seems to be driving productivity. Shouldn’t all that data be able to tell you where you ought to focus our efforts? Shouldn’t measurement make it easier to know what to do?
That’s the promise of Key Performance Indicators. They're carefully selected metrics that you rescue from their digital silo to integrate into the workflow of an individual or team.
The metric matters because it measures a daily activity that leads directly to business success. The employee or team must be able to control it completely for it to work. So, you hold producers responsible for production, because they can control that. You don’t hold them responsible for sales, which they can’t.
Today’s employees, and especially Millennials, love this sort of management. Millennials have been tallying “Likes” on Facebook their entire lives, so conceptually it’s familiar to them. Everyone appreciates KPIs because they empower them to prove their worth via an objective measure, which has the added benefit of making management easier.
That’s the proper way to use data to drive productivity, and switching to it would probably be a great thing for your organization. However, while the advantages of managing through KPIs might be obvious to you, an employee who’s accustomed to a less precise form of management might consider it a frightening change.
You have to bring them around. So, the way you introduce KPIs will have a huge impact on how much they benefit your company. It's called “change management.” That means that you plan to teach people how to change at the same time you actually change. It means you know in advance that your people will worry, and so you proactively address their concerns to put them at ease.
There’s no right way to do this, but there's plenty of wrong ways. In fact, “change management has been in existence for over half a century,” HBR reports, “Yet despite the huge investment that companies have made in tools, training, and thousands of books (over 83,000 on Amazon), most studies still show a 60-70% failure rate.”
Fortunately, we know what went wrong in most of those attempts. It comes down to two things:
Leaders must lead.
Change management must be driven from the top. People will make the effort to change only if they know that management is committed. The vast majority of those failures happened because the leaders were not.
Leaders must be digital.
“55% of [employees] who had gone through a change event at work said they wished their employer offered more digital and social engagement,” HBR reports.
The two are tightly related. “Few things are more important...than communication from leaders who can paint a clear and confidence-inspiring vision of the future,” HBR reports. The easiest way to communicate is the way employees want you to: digitally, in a text thread on their phone. If leadership doesn’t give them that, then communication, and change, become unlikely.
That means that leaders who want to implement KPIs will be far more likely to succeed if they put those KPIs into a social media-like environment where they can discuss them.
The combination can be extremely powerful. You know people will have some anxiety until they understand why KPIs are better for them, too. So it's best for you to introduce them in a social media platform where they can be openly discussed by managers and employees – and by you. Social platforms “offer leaders and employees a way to recognize and reward each other,” which is the essence of the positive communications you want in your organization.
In that situation the social platform will be adopted. The KPIs will be adopted. And, suddenly, you’ll have a whole new way to communicate with your team and your data will drive their productivity.
Soon enough you won’t be reassuring people about their KPIs. They'll be driving them. The change will be finished, and your social media platform will be all about the KPIs that sustain your culture of productivity.