Because performance isn’t about how much you do, it’s about the value you create.

Introduction

Key Performance Indicators (KPIs) are meant to measure success.
But all too often, they end up measuring the wrong things: busyness, surface-level activity, or vanity metrics.

Employees hit their numbers…
…but the business doesn’t grow.
Teams complete their tasks…
…but the customer experience suffers.
Leaders read “green dashboards”…
…but feel something is off.

The problem? Many KPIs track activity, not contribution.

In this post, we’ll explore how to set KPIs that go beyond tracking output, and start reflecting real value.

1. Activity vs Contribution: Know the Difference

Let’s start with a simple distinction:

Activity-Based KPI      -- Contribution-Based KPI
‍Calls made      -- Deals closed or qualified leads
Articles written      -- Article-driven signups or traffic
Hours logged      -- Client satisfaction or outcomes
Tasks completed      -- Impact of those tasks on goals

Activity shows what someone did.
Contribution shows why it mattered.

When you track activity alone, you reward effort.
When you track contribution, you reward impact.

2. Why Measuring Contribution Matters

When you set KPIs around contribution:

• People focus on results, not rituals
• Teams prioritize work that moves the needle
• Performance conversations become more meaningful
• You uncover the true value each person brings

And perhaps most importantly:
Employees feel their work matters.

That’s a core ingredient in long-term engagement and retention.

3. Start with Strategic Goals, Not Job Descriptions

The first mistake most leaders make is setting KPIs based on tasks instead of outcomes.

Instead, begin with these questions:

• “What business outcome are we trying to achieve?”
• “How does this role help drive that outcome?”
• “What signals would tell us they’re doing it well?”

Example:

• Instead of: “Publish 3 blogs per week”
• Try: “Drive 500 qualified leads from content by end of quarter”

This encourages smart, focused work, not just more of it.

4. Involve Employees in KPI Creation

Ownership increases when employees help shape what success looks like.

Ask:

• “What does meaningful contribution look like in your role?”
• “How would you measure progress if you were in my shoes?”
• “Which metrics feel like real value vs box-checking?”

This creates alignment and accountability, because the KPI isn’t being imposed, it’s being co-created.

5. Tailor KPIs to Strengths and Stage

Different team members may contribute differently, even within the same role:

• A junior designer’s contribution may be consistency and responsiveness
• A senior designer’s contribution may be creativity and strategy

Likewise, contribution shifts depending on the company’s stage:

• Early-stage = speed and experimentation
• Growth-stage = repeatability and scale
• Mature stage = optimization and risk management

Don’t lock people into outdated definitions of “value.” Adapt KPIs as the business (and the person) evolves.

6. Include Qualitative Indicators

Not all contribution is easily quantified:

• Mentoring team members
• Improving internal processes
• Strengthening team culture
• Raising concerns that prevent mistakes

While you can’t always attach a number to these, they matter.

Use:

• 360° feedback
• Project retrospectives
• Peer recognition
• Self-assessments tied to company values

These round out the picture of someone’s real impact.

7. Watch for Contribution Killers

Even well-crafted KPIs can lose effectiveness if the environment is wrong.

Watch out for:

• Conflicting KPIs across departments (e.g., Sales pushes volume while Support struggles with quality)
• Over-reliance on lagging indicators that don’t reflect daily contributions
• Vanity metrics (likes, views, downloads) that look good but don’t link to outcomes
• Micromanagement disguised as measurement

KPIs should empower, not create anxiety or busywork.

Example: Redefining KPIs for a Marketing Role

Old KPIs:

• 3 blog posts per week
• 1 email newsletter per week
• Social media posts 5x/week

New Contribution-Based KPIs:

• Generate 1,000 new leads from content per quarter
• Achieve 30% average open rate on newsletters
• Contribute to a 10% increase in website conversion rate

Result:
The marketer now focuses on message quality, targeting, and alignment with business goals, not just volume.

Final Thought: Measure What Moves the Business Forward

KPIs should help you answer one question:

“Is this person helping the business move in the right direction?”

If the answer is unclear, it’s time to revisit what you’re measuring.

Because when KPIs reflect real contribution:

• People know their work matters
• Teams make better decisions
• Leaders get real visibility
• And performance becomes purpose-driven, not just pressure-driven

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