Problems
In practice, overseeing key performance indicators can prove expensive or difficult for organizations. Some indicators such as staff morale may be impossible to quantify. As such dubious KPIs can be adopted that can be used as a rough guide rather than a precise benchmark.
Another serious issue in practice is that once a measure is created, it becomes difficult to adjust to changing needs as historical comparisons will be lost. As such measures are kept even if of dubious relevance, because history does exist.
Comparisons between different organizations are often difficult as they depend on specific in-house practices and policies.
Key performance indicators can also lead to perverse incentives and unintended consequences as a result of employees working to the specific measurements at the expense of the actual quality or value of their work. For example, measuring the productivity of a software development team in terms of source lines of code encourages copy and paste code and over-engineered design, leading to bloated code bases that are particularly difficult to maintain, understand and modify.
Read more about this topic: Performance Indicator
Famous quotes containing the word problems:
“It’s so easy during those first few months to think that the problems will never end. You feel as if your son will never sleep through the night, will always spit up food after eating, and will never learn to smile—even though you don’t know any adults or even older children who still act this way.”
—Lawrence Kutner (20th century)
“I have said many times, and it is literally true, that there is absolutely nothing that could keep me in business, if my job were simply business to me. The human problems which I deal with every day—concerning employees as well as customers—are the problems that fascinate me, that seem important to me.”
—Hortense Odlum (1892–?)
“If when a businessman speaks of minority employment, or air pollution, or poverty, he speaks in the language of a certified public accountant analyzing a corporate balance sheet, who is to know that he understands the human problems behind the statistical ones? If the businessman would stop talking like a computer printout or a page from the corporate annual report, other people would stop thinking he had a cash register for a heart. It is as simple as that—but that isn’t simple.”
—Louis B. Lundborg (1906–1981)