1. Do you balance quantitative and qualitative goalsetting?
People’s attention is naturally drawn to quantitative goals: these are concrete, easy to remember and to steer on. We still see the belief “if it can’t be measured, it doesn’t exist”. However, quantitative goals can be also very single focused, representing complexity in an oversimplified way. This can easily cause a tunnel vision that draws your attention away from the bigger picture. Therefore progress on these quantitative goals not always reflect the real progress you make as an organization. Our advice is to not only set qualitative goals beside your quantitative targets, but to also balance attention between quantitative and qualitative goals when having the dialogue on how you’re progressing.
2. What is the effect of KPIs on the intrinsic motivation of employees?
When the KPIs only stay a number to hit, it can have an adverse effect on the motivation of people, since it’s too far removed from purpose and what they can personally relate to. The story around the KPI and how it relates to the bigger purpose therefore needs to be well-explained and discussed. Besides: please be aware that too ambitious KPIs without changing anything else for the employees feels as ‘on top of’ and might demotivate people. Of course KPIs must be challenging, but be aware what is needed to actually achieve these and discuss how this can be overcome.
3. What dilemmas will employees encounter due to KPIs?
Be aware which KPIs in the total KPI set of people might be contradictory and possibly cause dilemmas. This can be confusing and frustrating, not leading to the desired outcome. Besides, when managers and employees get the assignment to deliver on KPIs, but in practice, they are steered only on the well-known KPIs, the importance of the sustainability KPIs will drop. Therefore it’s important to make the sustainability KPIs an integral part of the overall KPI set of managers and employees. Besides, be sure to make these – in terms of attention – equally important to the more traditional KPIs on (financial) performance and to have the dialogue around this.
4. Are we having the right dialogues to steer our progress?
Often KPIs are put in a dashboard. Working with a dashboard can be great, since it provides you with a compact oversight on your progress. The quality of steering however, lies in having a constant and good dialogue around the presented results in this dashboard. This joint reflection deepens the understanding of the figures and provides valuable insights to steer in an effective way.
Success factors for a good dialogue are:
- Fundament: Start from a basis of trust and togetherness. Spend time to create a common understanding of what your sustainability targets mean and how to use the dashboard in steering.
- Understand: Ask open questions without judgment and try to understand (root)causes of the displayed progress. Do not only focus on the red or green results, but spend time and attention to truly understand the (deltas of the) different elements on the dashboard.
- Interpret: Give constructive feedback and share and discuss ideas for improvement.
Of course, implementing these advices will not happen in a perfect way at once; it’s a process to develop. Having the right KPIs and – especially having the right kind of dialogues about these KPIs is something you will grow in. That requires experimenting, reflecting and adjusting where needed. Let’s get started!