Hello! Hopefully if you're reading this, you've seen part I, where we dive into the ideas of what KPIs are, and what can make them ineffective, but if not, use that link to read that post. They don't need to be read in order, but it's a very statistics-driven post that fuels this one, where we bring personal experience into the mix.
Thursday's Thought of the Week - How KPIs can be great and how they can be detrimental from an employee's point of view. In this post, we're going to add to the conversation from the Tuesday's Tidbits post with 3 unique perspectives - 1 from myself when I was in the Sales/BDR/CSM world, and 2 from a couple of my connections that have varying perspectives and job roles. The goal with this post is to add to the conversation about KPIs from an employee's POV, which typically won't get said aloud at work, because they're afraid they'll be seen as insubordinate or a problem.
Just before diving in, I'll point out the obvious - I'm not going to name the companies or people these come from, and I'll fully admit why - Though their perspectives are great, I can still see a possibility of some people thinking their feedback/criticisms would put their past roles in a negative light, and I wouldn't want any backlash against my colleagues, but I will provide as much context as possible while staying ambiguous.
Perspective 1 - Why Hire a Robot?
This perspective comes from a colleague I had at a large company where we were both AMs. Since then, this colleague has gone on to be in a variety of Sales roles, typically in leadership where hiring and strategizing where a large priority, so they have the perspective as both an employee who was held to regular KPIs and as a leader who established KPIs. Their stance on KPIs is much like what I posted in the Tuesday Tidbits post - The right KPIs, which are generated from the right place and are vital to the position, are incredibly useful, but KPIs for a lot of companies can be ineffective. The biggest way KPIs can be ineffective are if they don't pivot accounting for trends, or even the gifts, talents and skills of your employees.
Any time you hire a salesperson and have them conform to your way of selling, you essentially just have the same salespeople up and down through the company. If you're hiring someone for whatever skill/reason appealed to you, but then dictate the way they go about doing their job, you're removing that skill and just making them another cog in your wheel
I couldn't agree more with this. Everyone is unique, and with the large shift to hiring for skills instead of just accolades (especially in the start-up world), why would you adopt a mentality where you're then making your newly hired employees conform to "the way we do Sales"? It seems incredibly backwards, and completely mutes the unique personality and fresh perspective you just hired. Though there is merit in the idea of training new employees to the style that your organization holds, it's going a little too far to ask them to abandon what made them successful in their previous positions, and those fresh ideas might just be ones you adopt to take your organization to the next level.
The Lesson: Your KPIs should never be a higher priority than the personalities and unique skillsets that your new hires bring to the table. Your hiring process involves finding applicants with unique skills that your organization has identified as mandatory for reaching the next business milestone, so if your KPIs are muting those skills, are you really going to reach your next milestone?
Hiring an applicant for their unique skills, then telling them they have to conform to the system you have is like signing a Left-handed pitcher, because you don't have any on your team, but when it's time for them to pitch, you say "No no, we need you to pitch right-handed against this team"...Well why the heck did you sign me then?
Perspective 2 - Of course I'm failing, what did you expect?
This perspective comes from a colleague of mine that has worked at multiple large IT companies as an AM, BDR, and as an AE. Their main perspective on KPIs is that there are good ones, and there are bad ones. The defining factor really is answering the question "Is this absolutely necessary to succeed in this role?" If it is, it's likely going to be a great KPI, but if it doesn't, it's a time-waster.
Their perspective has been cultivated from their variety of positions with different types of companies. Some KPIs have been excellent for staying on track and being successful in the positions, but some of the unnecessary ones have created a feeling of needed to meet the small ROI metrics instead of the large ROI metrics. At one particular stop, they said they were held to both Quotes and Sales at the same standard, though Quotes and Sales are obviously not the same thing. In their opinion, why wouldn't you want to focus on the Sales more than the Quotes, especially if pushing for quotes didn't increase the amount of revenue for the position?
I feel like being held to a Quote metric was my least favorite KPI, because it forced people to find opportunities where none existed. Like, great, you created 5 quotes today, but when you don't close any Sales on those because you just wanted to check a box, are you really being productive and successful in your role? I definitely thought the priority should be on the sales aspect, but they treated both as equally important. Then you have meetings with your managers, and guess what? You have so many quotes out there, but they're not closing, and they're stunned as to why.
I have absolutely shared this experience, especially in the Quotes vs. Sales field. I completely understand the correlation, but if you want the quotes to reflect an actual, feasible projection for potential sales for a salesperson's region, treating Sales and Quotes as the same level of important doesn't make much sense. If you want to drive quotes just as much as sales, you'll most likely see your team's quotes metric jump up, but if you're not seeing a bump in Sales to go with it, is it really worth their time to generate these quotes?
For this reason, KPIs need to be flexible. It's perfectly reasonable to try new KPIs to track if increases affect your team's performance, but if they don't, a good leader should be able to pivot away from the harmful metrics that are wasting your team's time, so that you can increase your team's performance and efficiency. Failing to either identify KPIs that aren't providing any ROI or failing to pivot away from those KPIs can be detrimental for your team. Not only will they feel like they're grinding away to complete these numbers that don't help them achieve their #1 goal for their position, but they'll lose their motivation and stop engaging with the company, which will lead to role dissatisfaction and negativity on your team.
The Lesson: Designate your KPIs, and feel free to experiment with them, but don't hold to KPIs that don't return any value. If your KPIs aren't resulting in improved Sales, tweak them and find which KPIs will. As a leader, that will guarantee that your team reaches their team goal. I mean, which sounds better - Reaching your team Sales goal for the year, or hitting every metric, yet missing the Sales revenue goal? I'm willing to be you'd prefer your Sales target to get reached, because that's the only way your business will meet their business objectives for that fiscal year.
Perspective 3 - Why the heck would you give out an award for that?
We've finally made it to the section I'm sure everyone is waiting for - My own perspective! If you just read that and clicked away...you know what? That's fair. But if you stick around, you'll hear why I find that pressuring mundane KPIs does more harm than good for the entire team. For my own journey, I've been on both sides of the fence as well. I've been the employee/salesperson that was accountable for KPIs, and I've been part of leadership that helps establish KPIs. My most hated metric of all time has to be Dials. I worked for a company that preached the necessity of dials above all else, and it made absolutely no sense to me, because I was a Salesperson. I should be held accountable for Sales first, and then other metrics second, but that's not how the position worked. I actually got in trouble multiple times for reaching my monthly sales goal, but failing to reach my Dials goal, and honestly, I knew I wouldn't be there long after this pattern started occurring.
So why did I hate the Dials goal? Aren't dials a good indication of your productivity? I actually do agree to some degree with this, but I don't typically like a "only one way" mentality when it comes to daily activity metrics. When I left this role and joined a company where I was now part of the leadership team establishing the KPIs, my new company had a Dials metric as well, and it's the first thing I got rid of. Why? Because calling people isn't the only way to communicate, and I wanted people to be able to prioritize different methods. Our team went from 50 dials a day to 75 communications a day, including calling, emailing, and social media. Guess what happened? Now that they had the ability to diversify and reach different people in different ways, our productivity soared, and our team hit their Sales goals for the first 3 months in a row. Shattered them, actually.
At the first company I mentioned, there wasn't any metric for anything other than calls, and don't get me wrong, calls are important. This post by Polite Mail shares a couple reasons you would want to choose calls vs. emails, but my vantage point prioritizes combining different methods rather than just the dialing column. I actually have spoken with a lot of companies about various positions over the past couple years, and when I ask about their methodologies, I would still say that 50% talk about tracking dials and no other type of communication. I'm sure that's fine for companies and I'm not here to argue that the approach is obsolete. It's just not my style, and it's never been the only way I've succeeded. In my past, LinkedIn was my largest arena for finding new prospects with Marketing campaigns coming in 2nd, Calling in 3rd, and Emailing in 4th. I was at my most successful when I was free to use what worked for me instead of being told that the company had "only one way" to succeed.
The other thing I saw with this Dials metric at a past company is that when leadership prioritized it, it came with disastrous results. When our leadership team pushed the Dials metric above even the Sales metric (for many reasons I don't want to take 10 minutes explaining), this led to a few bad habits and practices coming out of it.
People started faking their metrics. If you ever establish a KPI that your team knows won't provide ROI for their Sales, it's a recipe for faking. We would have people call dead numbers, operators, and people after hours to hit this stat so they wouldn't come into question. In fact, we hit our Dials goal 3 months in a row...and failed our team Sales goal each of those 3 months
People started getting discouraged. Our leadership started awarding those who reached their Dials goals, meaning that the same people who faked their metrics would win gift cards and prizes while those who did honest work got nothing. This obviously resulted in even the "good" employees who were working hard to get a "fake it to make it" mentality, because the good, honest work wasn't worth it
As the discouragement grew, people started disengaging from the company, losing their motivation, and looking for other jobs where they wouldn't hear the same conversation about a metric that didn't equate to Sales. We lost many good Salespeople who went on to better positions that had strategies with KPIs that made sense for the role, and positions where the companies allowed them to try multiple methods to succeed instead of just one.
Numbers tanked. During this Dials-focused initiative, numbers across all teams tanked for about 3-4 months until leadership went back to the drawing board and thought of a different way to do KPIs.
The Lesson: The important KPIs should start with your team's #1 goal and work backwards. If you're on a Sales team, and Sales isn't the first trackable metric that gets discussed, it might be time to rethink your KPIs, or at least the KPI priorities. When my team in the past prioritized Dials instead of Sales (or even just activities vs. just dials), we saw a large amount of job dissatisfaction, an influx in faked metrics, and a decrease in sales.
Hopefully this post helps provide some internal perspective from a variety of different voices with a variety of different professional road maps. Again, the goal is to add to the conversation of KPIs, this time from an employee perspective, so that we can highlight how KPIs can become detrimental instead of a great source to track the productivity and success of your team. If you have similar experiences, we absolutely welcome you to add to our conversation!