A common paraphrasing is, “When a measure becomes a target, it ceases to be a good measure.” When I talk about this, I tend to add, “And the target therefore no longer means what you think it does.”
Goodhart’s law is a critical piece of information when we think about metrics. No matter how tempting it might be, the moment we set a target for a measure, we’ve changed the system, thereby changing what the measurement means, thereby changing what the target means.
The lesson here is pretty simple. Don’t set targets for metrics. And please don’t give teams incentives towards targets if you do set them. I know. I know. Management 101 says this works. But, science says it doesn’t. Seriously. Setting targets and providing incentives for knowledge work lowers performance. Don’t do it.
Instead, provide guidelines to the teams. My favorite guideline for metrics is, “Monitor trending. Dig in when the trend changes and you aren’t absolutely certain why.”
This article is an excerpt from the book, “Escape Velocity”, available on LeanPub, Amazon, and elsewhere.