All the KPIs were green, but…

“All the KPIs are green, but the reality is quite different.” The line shows up in steering committees more often than it should - and it is, almost always, a warning that could have been avoided by keeping Goodhart's law in mind.

In its cleanest form: when a measure becomes a target, it ceases to be a good measure.

A manufacturing example

A manufacturer sets a target on the scrap rate to improve quality. To hit the target, production teams quietly move non-conforming parts into work-in-process, or relax the acceptance criteria at the tail end of the line. The scrap dashboard turns green. WIP explodes and fills with semi-finished goods that should have been rejected outright. Quality does not improve; it simply becomes harder to see.

An extreme example

In colonial-era Delhi, the British administration tried to reduce the cobra population by paying a bounty for every snake killed. Residents promptly started breeding cobras to collect the reward. When the programme was stopped, the bred snakes were released. The cobra population ended up higher than before.

Both stories have the same shape: a number that was meant to reflect reality becomes a lever people game, and the underlying reality drifts in the opposite direction.

What to do about it

Combining KPIs to reconstruct a 360° view is one answer, and it is worth doing. But the more durable fix is cultural: a team that shares a clear mission - and that is genuinely oriented toward the customer, the user, the citizen - is much harder to nudge into numerical theatre. The number is still a number. The dashboard still turns green. But the people reading it know what it is actually measuring.