Okay. Stick with me on this one, because I know the title might sound contradictory.
If you can't be bothered to read it all, here's the abstract:
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KPIs focus people on the minimum performance metrics, whereas achieving high performance is all about going above and beyond this, by some measure.
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For those of you who are interesting in the meandering waffling of a chirpy little fella from T' North...
First, for the uninitiated - KPI = Key Performance Indicators. Second, KPIs mean different things to different people, in different industries, and different contexts.
Here's a few:
KPIs for your front-line operative
Usually, these are volumetrics designed to achieve the minimum standard of performance and achieve the target profit-margin. E.g. Do X things in X time.
KPIs for a front-line people manager/team-leader
KPIs for Department Leaders/Managers
KPIs for Vendors/Consultants/Partners
Some of your (hopefully most) will see, quite clearly, from that list that there should obviously be some kind of link between the different levels of KPI.
And you may think "Well, if everyone hit's KPIs we are, by definition, hitting the right level of performance". And you might think the rest of this article isn't for you - you clearly know your stuff! Actually - you're exactly the person who should read on.
Why KPIs can actually restrict performance
So, KPIs are designed to achieve the minimum standard, or maybe a target profit margin. And that's great. But. Even when your key indicator of performance is set at the optimum level for strong profit and productivity this can restrict performance, at all levels.
Let me put it into perspective for you.
If Person A, the front-line operative, had to do 10 things in 1 hour (their KPI) and their reward for doing 12 things in 1 hour was, well, an expectation they always do 12 things in 1 hour from now on - then unless there's some kind of performance bonus* there's absolutely no rationale in doing 12 things in 1 hour, unless you want to. But again, beyond some intrinsic desire to do more, for the same, why would you want to? Now let's look at Person A's team leader. If they have 5 people, and their hourly target as a team is 50, and Person A is doing 12 an hour, then Person B is doing 8 per hour, and People C, D & E are doing 10 an hour, we're on target. And if Person A is happy to do 12, without any real benefit to them, then what is the benefit of the team leader trying to improve the performance of Person B?
And as we throw this up the chain, why would anyone go beyond their KPI and try to achieve high performance**? What's the point? Other than working harder than you need to? Or giving more of yourself to an employer who doesn't genuinely value you?
So you you see KPIs ≠ Achieving High Performance. KPIs can actually nurture a mindset that inhibits your ability to achieve high performance. And before I continue, I'll address a couple of points I flagged above:
*Performance Bonus. A free snack, extra break-time, or an early finish (that can only be taken when you say so) is not a reasonable performance bonus. And if an individual exceeds their KPIs, but their bonus is tied to the team/company performance - this also isn't a genuine performance bonus - it's a horrible trick to manipulate your people. You know it, I know it, and they know it.
**This one's for those of you in the corporate world screaming 'That's What Performance Management is about!' at your screens right now. First of all - most Performance Management is designed with enough wiggle room to make sure people only achieve the 'minimum' rating. It's a fallacy. It doesn't drive high performance in any meaningful way. Secondly - Realise that the vast majority of the people in your organisation who actually do the thing that makes your business money (those on the front-line) are either not a part of the corporate PM scheme, not given the level of performance and development support that corporate employees are, or are focusing on KPIs (see above) that doesn't encourage them to improve because the rewards are pretty meagre (and you expect them to be grateful for it!).
Now let's get back to it...
If KPIs ≠ Achieving High Performance, what is?
Let's consider the things that actually encourage people to do their best, and be their best, at home, or work:
1. Purpose
It's well established, among many walks of life, that when someone is aligned to the purpose of something, they'll perform better. The same is true at work. When your people are wholly aligned to the point of the 'thing' they're doing, and it's something that sits well with them, they'll perform better. So while it's important to have some KPIs, if you want to drive a high-performance-mindset, it's imperative that you create a clear line of sight between what you're asking them to do (and why) and help them understand how this supports the purpose of the organisation, and their personal priorities.
2. Tangible, meaningful Reward and Recognition
3. Trust and fairness
4. Challenge
5. Results
So what?
I almost started this paragraph saying, in the traditionally British apologetic tone "Sorry to say this but...". The things is, I'm not actually sorry. And if this bit upsets you, you're exactly the person who needs to hear it. So here comes the 'So what' to all of my ramblings...
Key Performance Indicators have a place, I agree with that. The issue is that far too many managers, leaders and organisations believe that if people are hitting or exceeding KPIs, then you have 'high performance'. But that's wrong.
As I've explained (hopefully in a way that made sense to you), achieving high performance and nurturing a high-performance mindset, and culture, needs so much more than just some KPIs, and a token gesture. Underpinning everything else I've said in this post about achieving high performance it requires managers, leaders and organisations to create the conditions for high performance through their words, actions and behaviours, every day. So step up. Get it done, and help your people, and your business be the best it can be, every day!
About the Author - And Apples Performance and Learning
This is where you usually get the obligatory profile, and pitch - feel free to skip it, but I'd rather you didn't. If you've read one of my posts before, this next bit will be familiar :).
Hi. I'm Andy. I'd rather not bore you with a profile, when you can find out what you need here. So take a look, or don't - it's quite literally up to you.
Also - I could give you a really slick 'sales pitch' about how Apples Performance and Learning can help you navigate through the minefield that is Performance Improvement. But I won't. To be frank, this post is already too long, and I'm bored of my own 'voice'. If you want to know how we can help you - check this out, or this.
Beyond that, if you've made it this far, thank you for sticking with me. Hopefully you agree with my points, and find some value in them. If not, please feel free to correct my perspectives - I won't learn anything new otherwise! andy@aplconsulting.co.uk
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