Issue #

2

February 19, 2025

The Power and Pitfalls of KPIs

This week: How KPIs shape systems—and why measuring the wrong things can create the wrong results.

A Systems Perspective

Every system is optimized for the outcomes it tracks. What we measure defines what we prioritize, how we allocate resources, and ultimately, what gets done.

  • Hospitals measured on patient throughput can end up prioritizing speed over quality of care.
  • Schools focused on standardized test scores may emphasize test prep over real learning.
  • Workforce programs that count job placements instead of long-term career growth often produce high churn rates instead of stable employment.

KPIs are not just indicators—they are drivers of behavior. If we aren’t careful, we risk optimizing for metrics, not mission.

Designing for Impact

If KPIs define system behavior, then the challenge is designing measurement frameworks that incentivize the right actions.

1. Focus on measuring what drives impact, not just what is readily quantifiable.

  • If a program’s goal is economic mobility, then long-term earnings—not just job placement—should be the KPI.
  • If a policy aims to reduce homelessness, tracking emergency shelter use may be misleading—measuring stable housing tenure is more meaningful.

2. Shift the focus from broad metrics to meaningful, actionable insights.

  • A city that tracks only the number of new businesses launched might overlook whether those businesses are sustainable beyond the first year.
  • A workforce initiative focused on hiring speed may neglect whether workers stay and thrive.

3. Design KPIs that encourage learning and iteration.

  • Good measurement frameworks include feedback loops—allowing programs to adapt based on what’s working (or not).
  • Instead of setting rigid success benchmarks, create KPIs that track progress, bottlenecks, and unintended consequences.

Execution is Everything

The most effective workforce programs don’t just track placements—they design for long-term success. By redefining their KPIs, several initiatives have created measurable, lasting impact:

  • Project Quest focused on earnings growth and job retention rather than just job placements. As a result, participants saw an average wage increase of $5,240 per year, sustained even nine years post-program. [Source]
  • Year Up integrated employer partnerships and structured training, leading to higher earnings—30% more than peers who didn’t complete the program. [Source]
  • Accenture’s Cybersecurity Apprenticeship shifted its focus from program completion rates to full-time job transitions. By designing real-world industry exposure into the apprenticeship, they helped participants seamlessly move into high-demand cybersecurity careers. [Source]

These programs show that measuring what matters not only reflects success—it drives it.

Our latest blog post explores how aligning KPIs with long-term workforce outcomes can help close the skills gap. Read more here: The Skills Gap: Success Is In How We Measure It

Questions to Consider

At Opus Group, we believe better systems start with better questions:

  1. Are we measuring what matters, or just what’s measurable?
  2. How do our KPIs shape incentives and drive behavior—intended or unintended?
  3. What would happen if we stopped tracking certain metrics? Would we make different decisions?

Quote of the Week

“How am I complicit in creating the conditions I say I don’t want?”

— Jerry Colonna

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