Many companies have detailed KPI systems, yet they face a surprising problem:
KPIs are being achieved, but business performance is not improving at the same level.
The problem may not be the KPIs themselves. It may be how they are used.
According to Deloitte’s 2025 Global Human Capital Trends, 61% of managers and 72% of workers do not trust their organization’s performance management process. Only around 26% of organizations say their managers are very or extremely effective at driving team performance.
One common problem is that companies measure what is easy to measure, rather than what creates real value.
For example:
- Sales measures the number of calls instead of the quality of opportunities.
- Customer Service measures tickets closed instead of customer satisfaction.
- Marketing measures leads instead of lead quality.
- Managers measure reports instead of decision quality.
Activity is not the same as performance.
What can companies do?
- Start with the Business Outcome
Ask:
“What value does this KPI ultimately create for customers and the business?”
- Combine Leading and Lagging Indicators
Do not only measure the final result. Also measure the actions that are likely to create that result.
- Focus on a few critical KPIs
A few meaningful measures are often better than a long list of KPIs.
- Use KPIs as management tools
KPIs should not only be used at the end of the month. They should help managers identify gaps and take action while there is still time to improve the result.
A good KPI does not only tell us how much we have achieved. It tells us what we should do next.
LET Perspective
Performance Management should not simply be a system for measuring people.
It should be a system that helps people create better results.
Source: Deloitte, 2025 Global Human Capital Trends.
