I am sure you’ve heard the expressions:
- "That which gets measured tends to improve."
- "If you can’t measure it, you can’t manage it."
- "You get what you pay attention to."
In many ways in business you get what you measure.
What if you are measuring and focussing on the wrong thing?
Unfortunately, you will get that too.
How Most Do It
Say you are running a customer support or call center.
People call in or complete a support request online and the job at hand is to resolve customer problems.
Since call centers are expensive and generally are after sales costs, the usual goal is to have as many customers served by as few people as possible.
This is the cost center approach.
So you measure how many calls each employee can handle each day (maximize) and the time spent on each call (minimize). These are not necessarily “bad” numbers to track by any stretch.
Then you start offering employees incentives and penalize those who are below standard.
Everyone starts playing the numbers game to win. Good stuff right?
Employees hurry each customer through their problem with the goal of closing them fast. Not only that but they may start avoiding taking the calls they know will take too long to resolve from the queue, leaving them for someone else. The kid’s college education is at stake after all.
The “good ones” hurry customers to a closed call. The “less effective ones” may spend too much time on the calls handling more difficult issues even though the customer may be happy.
But are customers actually having their issues resolved? Are they happy? Are they going to buy from you again? Will they recommend your company to their friends?
You can’t tell from these measurements.
So you add a satisfaction metric or two to the equation.
Fast, Low-Cost AND Happy.
But can you really get everything you want on the cheap just by mandating it?
Zappos is known for legendary customer service. Delivering WOW.
In fact, according to the book “Delivering Happiness”, they don’t evaluate employee performance on call length or volume at all. Employees are free to spend as long as required to make a customer happy. The record is 6 hours.
They put the focus on the relationship and making the customer happy.
And they don’t spend much on Marketing as a company.
They don’t need to cover up poor service and support with expensive marketing to bring in new customers.
So they get extremely happy customers AND repeat business and referrals.
Good profitable business.
Be careful what you measure and evaluate employee performance on. You will get what you focus on; but at what cost?
The key is to align your metrics with your overall business strategy: mission, core values, culture and vision.
Personally, I prefer team based performance targets for most business objectives. This encourages people to work together better as a team and for team members to align their skills where it best serves the team.
With a sports team the overall goal is to win games and ultimately the championship.
Don’t get me wrong, I am not saying accept poor individual performance or pay everyone the same. Athletes on professional sports teams never all perform the same roles nor do they get paid the same. But they can all win at the same time.
I am saying set team goals and reward people for their real contribution; not one metric for everyone.
You get what you measure (and focus on). Choose wisely.