Why Your KPIs Are Lying to You

Every KPI is an answer to a question. The question that is almost never asked is: is this the right question? KPIs lie when the questions that produced them were shaped by a flawed decision structure.

How the Lie Gets Built

Businesses measure what is easy to measure (revenue, leads, utilization) rather than what is important. When a measure becomes a target, it ceases to be a good measure (Goodhart's Law). Teams find ways to perform well against metrics that do not improve underlying outcomes.

The Decision-Governance Approach

Start from the decisions you make. What information would change those decisions if it were available? This produces leading-indicator sets — metrics that change before the outcome changes. Every quarter, ask: what are we making decisions about that we have no data on? What assumptions have never been validated?

KPIs create confidence. Confidence is a liability when it is not calibrated to the quality of the underlying information.