Bringing KPIs, and your team, to life. Turn KPIs into a powerful leadership and team alignment tool.

Love them or hate them, key performance indicators (KPIs) are a standard tool for most organisations, used to set a direction and convey a common goal. Yet, for most, they are a boring box-ticking formality. However, if you’re a leader willing to embrace them, KPIs have the potential to not only help you hit short-term goals, but galvanise your team, nurture trust and transform ongoing performance.

The problem with key performance indicators
KPIs get a bad rap. In part, this is due to their origin as a set of hard-and-fast benchmarks – sometimes apparently arbitrary – handed down from on high, often with little explanation or leadership guidance for interpretation within each team’s context.

Truth is, the problem with KPIs isn’t the concept of KPIs, but the way they are employed by leaders. Just as KPIs are universal, they’re almost universally misused.

Do you use them as a shortcut or, even worse, as a way of deferring responsibility? Or do you use them as a leadership tool and team development opportunity?

Using KPIs to bring out the leader in everyone
While some of us have leadership titles and clearly defined leadership responsibilities, the more sustainable and enduring way to build the most effective team is to nurture the leader in everyone.

KPIs can help you do this.

Now, anyone can set KPIs and post them on a board or include progress in a management report. And you could simply pass some of your own leadership KPIs on to individuals within your team. But that’s missing the point, and the opportunity.

The key to using KPIs effectively is to use them to focus and engage everyone within your team in the problem-solving work of leaders.

Use them to facilitate an open and meaningful conversation that enables you and your team to:

clarify the wording and meaning of KPIs (they are surprisingly subjective and open to varied interpretations)
clarify everyone’s role and the nature of their work in the delivery of the KPIs
agree what success looks like for the team once they have achieved the target
identify barriers and challenges that stand in the way of success
clarify what you need from individuals for the team to succeed
clarify what they need from you as the leader of the team
identify areas where the team lacks the capacity (time, energy) or capability (skills, experience, knowledge) to perform effectively.

An initial team dialogue is crucial, and so are regular, ongoing team check-ins to refresh, update and refocus on the successful delivery of the KPIs. What are you and the team concerned about? What distractions should the team ignore? What will prevent you and your team from achieving your KPIs? What does your team need from you and others if you’re to succeed?

By making the time to sit down with your team and ask yourselves questions like these, while using KPIs as a frame of reference, you can transform team performance and, crucially, trust (here are some more insights into nurturing trust to improve team effectiveness).

Bring KPIs (and your team) to life
A series of simple conversations that engage your team as leaders will make KPIs real for everyone. It’s an opportunity to:

align and unite your team behind a common goal
break out of negative thinking and focus on positive actions
acknowledge that there are some things you and your team can’t control
concentrate on the things you can control and plan to mitigate the impact of the things you can’t (or influence those who can control them)
improve working relationships and promote accountability.

Why good leadership is about mindfulness
There are lots of ways to define good leadership.

You could say it’s all about managing your people and culture to improve trust, capacity, capability and performance. That’s why simple conversations are such powerful leadership tools. Take the KPI conversation we’ve discussed here: it’s a conversation that makes solutions top of mind for your team, rather than just focusing on the challenges.

But that’s only part of the battle. You need to maintain that level of mindfulness in your team. One conversation isn’t enough. If you want to improve team effectiveness and performance in a sustainable way, you’re going to have to take the lead in helping your team think like leaders.

Check out some of our real-world stories to find out more about how organisational psychology can improve team effectiveness and leadership capability. Read more about nurturing trust and assessing your team’s predisposition to trust. Or Talk to us about the leadership development challenges you’re facing.

Jan Sipsma is an organisational psychologist and founding partner of Kaya. With over 20 years of international experience as an organisational effectiveness consultant, he specialises in strategic planning, organisational architecture and design, change management, capability and performance enhancement and the identification and development of leadership. He has a Masters of Commerce (Industrial Psychology) cum laude and is a registered member of the Australian Psychological Society.