Every executive knows the importance of measuring performance. KPIs, dashboards, OKRs, and “Rocks” have become the language of management. But somewhere along the way, we’ve confused precision with progress.
The truth is, the value of a KPI isn’t in the number—it’s in the dialogue it sparks.
When the Metric Becomes the Mission
Years ago, I was building an executive KPI system that cascaded from the boardroom down to every department. It was clean, aligned, and measurable, until I reached the engineering department.
We were designing and building noise barriers. Every project was unique, with hundreds of hours of engineering work and dozens of drawings. My instinct was to standardize it: each drawing should take x number of hours, and engineers would log their time against that standard. It seemed logical and operationally sound.
Not exactly.
The engineering manager and I spent weeks trying to define what “standard” meant. Every project had exceptions, and every drawing was a little different. The more we tried to perfect the system, the less useful—and more frustrating—it became.
One evening, I stepped back and asked myself: What am I really trying to achieve?
That’s when it clicked. The goal wasn’t to create the perfect metric—it was to create the right conversation.
The Conversation is the Key
A KPI isn’t valuable because it’s exact. It’s valuable because it highlights a variance—a reason to talk about what’s working, what isn’t, and how to improve. The number is just the spark; the insight comes from the exchange.
When I explained this to the engineering manager, he proposed a better approach: let the engineers set their own estimates for each assignment. At first, I worried they’d inflate the numbers. He just smiled and said, “Maybe. But then we’ll talk about it.”
And that’s exactly what happened.
If an engineer said a task would take 20 hours and the manager thought it should take 12, that difference prompted a discussion—before the work even began—about how to approach the task most effectively. The manager could offer guidance, the engineer could share context, and together they’d arrive at a better plan.
The number was just a catalyst for the collaboration.
Continuous Improvement Over Control
Over time, those conversations multiplied. The engineering manager began meeting weekly with his team to review lessons learned. When one engineer found a better way to complete a set of drawings, that method was shared across the group. Not every project was identical, but the challenges were similar enough that collective learning compounded.
As a result, overall efficiency improved, communication deepened, and the department’s engineering cost as a percentage of revenue steadily declined. All this happened without ever having a “perfect” KPI.
When Precision Becomes a Trap
It’s tempting to chase precision. Leaders love clear numbers—they feel objective, definitive, and safe. But when the pursuit of measurement outweighs the purpose behind it, metrics can become a trap. I’m not saying that you shouldn’t pursue precision, but don’t lose track of the plot.
It’s like trying to lose weight to get healthier. Many people set a goal, such as “I’ll lose 10 pounds.” But if you gain muscle and lose fat, the scale might not move, but you’re healthier and stronger. If you’re too fixated on the number, you could miss the real progress that you’ve made.
The same is true in business. You can measure every hour, every defect, every variance—and still miss the point if the system doesn’t encourage learning, ownership, and improvement.
The Takeaway
KPIs are not an end—they’re a means. Their real value lies in what happens after the number appears: the dialogue, the curiosity, the shared problem-solving that follows.
In the end, you don’t need a perfect metric to drive performance. You need to spark a conversation about how to make the business better.
