KPI Problems
‘Would not recommend’: Why Net Promoter Score is dangerous
Would you recommend our company to a friend or colleague? This innocent-sounding question has spawned a multi-billion dollar measurement industry. The Net Promoter Score (NPS) has become the default measure of customer satisfaction and loyalty for most major corporations. Two-thirds of Fortune 1000 companies use it. There’s just one small problem – it doesn’t work.…
Teaching to the test
Benjamin Wann Guest author Teaching to the test On October 19, 2009, the Atlanta Journal-Constitution broke a story with the provocative title “Are Drastic Swings in CRCT Scores Valid?” The CRCT acronym referred to the Criterion-Referenced Competency Tests, which were, as the article specified, “Georgia’s main measure of academic ability through eighth grade.” The report…
Keeping Score & Rats in Hanoi
Benjamin Wann Guest author Keeping Score “If a strategy is to be achieved, it must be publicly tracked, measured, and monitored. If you are trying to lose weight, you must get on the scales regularly.” -David Maister “What Gets Measured, Gets Done.” -Unknown Think about the last time you watched a casual game of pickup…
Did an Excel mistake cripple the world economy?
On 4 January 2010, in the Marriott hotel in Atlanta, two giants in the world of economics, Prof Carmen Reinhart and former chief economist of the International Monetary Fund, Ken Rogoff, were presenting their research paper, ‘Growth in a Time of Debt’. The headline message was clear and head-turning… When the size of the country’s…
How Hewlett Packard ruined Ghostbusters for me
I like silly I love films. I’m quite happy to suspend disbelief for a couple of hours and watch something silly. That’s how I found myself sat in the cinema with my kids last week waiting to watch the remake of Ghostbusters. I was in a good mood until this advert for Hewlett Packard Enterprise appeared…
Are you deliberately breaking your KPIs?
We value your feedback… I’ve noticed an interesting trend when shopping: A practised extra tip or helpful comment by the sales assistant, shortly followed by a slip of paper being passed to you with a web link for leaving feedback. A sales person explaining that you will get a follow-up customer satisfaction survey and confiding that…
The “King Midas” award for Measures with Unintended Consequences
King Midas is famous for an apparently good idea – everything he touched turning to gold – with unexpected side effects – starvation. I regularly stumble across less dangerous variations on this theme, with measures that create completely unintended consequences. I’m looking for your favourite examples of bad measures, KPIs or metrics. The winner will…
30 Second Tip: Do you spend too much time looking backwards?
Look at your main KPIs, do they look forwards or backwards? Do you spend most of your time looking at financial measures that tell you how things were a few weeks or months ago? It’s good to include a number forward-looking measures, that indicate how you will do, as there’s still time to change the…
The Problem with Management Information
My local taxi company has been taken over. It has been bought out by Taxi-Rank Services PLC. They have started to apply big business thinking to a small business. It is a revelation. As you know, “what gets measured gets managed” so the first job, post take-over, was to apply a little science to their…
Do not shoot the messenger
I have witnessed more debates about KPIs and measures than any human really should. They normally settle into a few clear families. We shouldn’t measure -insert controversial topic- because: It’s too hard/expensive to measure We tried that before and it didn’t work It doesn’t have a causal link with the thing that we are interested…