How to make sure KPIs are not 'proxies' to what we want to achieve but directly measure it?

Many useful KPIs are proxies because the ultimate KPIs (like revenue) are often lagging indicators. The key is to clarify the link between a metric and the outcome. Pick metrics that logically roll into the business outcome you care about, and build in review points to ask: “is optimizing this metric actually moving the business needle?” If you find the KPI is being gamed or optimized in isolation from the business goal, change it. KPIs aren't meant to be set-and-forget tools. Evolve them as the ...Read More

When I want to avoid proxy KPIs and measure the real thing, I do three simple things: 1. Start with a plain-language outcome Before thinking about numbers, I write one clear sentence about what success actually is, in customer and business terms. For example: “New developers can start contributing meaningful code within 2 days.” “Most security issues are fixed before code is merged.” “AI-generated code is actually used and kept, not rewritten.” Only after that do I ask:“What can I measure that w ...Read More

The key is alignment: every KPI must directly map to the desired outcome. Proxy metrics can be convenient but misleading. For example, tracking only chatbot resolution time may suggest speed, but doesn’t capture accuracy or user satisfaction. A better KPI combines resolution accuracy, time, and follow-up behavior, providing a holistic view of real impact. Periodic validation is also critical: if changes in the KPI don’t reflect true progress toward the goal, the metric needs adjustment. Direct, ...Read More

To avoid proxy KPIs, start by clarifying the real outcome you want — the change in user or business behavior that defines success. Then ask: “If this KPI moves, does it prove the outcome happened, or just suggest it might have?” If the link is indirect, it’s a proxy. Replace or pair it with a direct metric that reflects actual value creation. Example: Instead of “time spent in app”, measure “tasks completed successfully.” Instead of “feature clicks”, measure “users achieving desired result.” Ins ...Read More

KPI’s are measured and recorded to track performance and business decisions are rendered with the use of this supporting data. The intent behind this movement is to provide managers and leaders with more information and drive better decision making.  While there is a need for Proxies in some cases, it is very important to choose these with utmost care and deliberation. Having clear goals to achieve will provide a great way to avoid choosing the false "proxies". Choose KPIs that should be measuri ...Read More

Every KPI exercise should start by asking, "What are the direct business outcomes we hope to move the needle on with this intiative?" So often I see KPIs focused on something like pure adoption metrics. Ok great, we want people to adopt this feature but WHY do we want them to adopt it? Do we think it will help reduce churn? Do we think it will drive conversion? Do we see a correlation between customers that adopt this feature and stay past the 30 day mark? Is this feature a key part of our Aha m ...Read More

When thinking about KPIs, it starts with understanding your customers and the value you expect to create with your product: Think, first, in terms of outcomes Outcomes = What does success look like for your users and your business? A good way to imagine user outcomes is to ask "What would change in our users' lives if this is successful?" This lays the foundation for working backwards towards useful metrics/KPIs When you think you've found a good metric, ask yourself "So what?" Our daily active ...Read More