Measurement in business performance is imperfection lies in that measures always reflect certain aspect of object but not the whole story. The measures is not objective, of cause. Figuring out relationship between measurement and objective makes people get insight about business process and cause and effect. More importantly, the imperfection enables management team validate their hypothesis about business strategy, which makes change in according to results of validation possible.
For employee, performance measurement if subject, correlate to their income, and interesting, they will natural think measurement is objective. The tendency of focusing great attention on measurement but not object itself indeed misleading and damage business morals. The false incentive for employee, which drive them concentrate on measurement, narrow their scope of duty and weaken motivation of self-development. If pressure is too high comes from the measurement, employee might cheat on important data to makes measures looks better.
Misunderstanding object and measurement by management team can be disastrous. Measurement in business performance is imperfection and by nature of measures require the whole team reach agreement about what measures can better indicate the business process. If chose wrong measures and managers focus on that but not whole business strategy, then divergence between true object and measures will enlarge and eventually jeopardize business. Same as employee, if pressure from measure is too high and measures correlate to income, management team probably deceive on reality and misleading higher authorities.
Above all, when comes to humanity, if designed properly, and used measures correctly, the above said side effect can avoid. For example, only use validated measurement subject to income and some measures only use for surveillancec purpose. Imperfection of measure leaves great room for both manager and employee to think about business process and do they best to contribute to common goal and makes company to thrive and prosperous.
