Soft metrics

Most managers excel at tracking hard metrics—revenue, production volume, and profit margins. Yet the metrics that often drive the most significant improvements in team performance are frequently overlooked: soft metrics.

Hard vs. Soft metrics

Hard metrics are quantifiable and objective—revenue generated, units produced, customer acquisition costs. Soft metrics are qualitative assessments of performance areas like meeting effectiveness, communication quality, and team collaboration.

Whenever I mention that managers should pay attention to both hard and soft metrics, I often get a divided reaction. Half of the audience nods, knowing how important discussing soft metrics is to develop talent and improve effectiveness at what would otherwise be neglected. The other half frowns, anticipating uncomfortable conversations and subjective disagreements.

However – and this is critical – this only happens if you discuss soft metrics infrequently, say, once a quarter or less. In this case, I agree: you and your subordinate will likely differ in your assessment of how well they performed against a soft metric. Even worse, if this discussion takes place during a formal performance review, the risk that it leads to defensiveness, blame, or frustration is high.

But if you discuss soft metrics frequently (at least once a month) and you do it in informal settings (say, at the end of a one-on-one meeting on another topic), the conversation will be more open and constructive.

The Superiority of Soft Metrics for Skill Development

Soft metrics are exceptional tools for developing skills and effectiveness. Allow me a basketball example: if a player struggles with scoring, setting a hard metric like "points per game" only helps if their limitation is motivation. If their shooting technique needs improvement, this metric may actually encourage counterproductive behaviors, such as taking poor-quality shots to meet their target. Conversely, a soft metric like "shot selection quality," discussed frequently after games and practices, addresses the underlying skill gap and leads to sustainable improvement.

How to Set and Evaluate Soft Metrics Effectively

Soft metrics require more definition than hard ones. When you set a hard metric like "$5M in revenue," the meaning and measurement are clear.

Conversely, when you set soft metrics, you cannot assume that your delegee knows what a good outcome means. For example, what does “running effective meetings” look like?

The key is to give examples of what the good and the bad would look like. What does it look like when meetings are run ineffectively? And what does it look like when they are run effectively?

Even better, I like to use my “bad/good/great” framework, which also includes what great performance would look like.

Finally, avoid the temptation to measure soft metrics using hard outcomes (e.g., measuring meeting effectiveness by project completion rates). While convenient, this approach fails to develop the specific skills that need improvement.

Conclusion

Complement your hard metrics with carefully selected soft metrics to support your team's development. Provide concrete examples of what bad, good, and great performance looks like for each soft metric. Most importantly, discuss performance frequently in low-pressure settings rather than saving these conversations for formal reviews.

Implement this approach consistently, and within a few months, you will see both soft and hard metrics improve as your team develops new capabilities and greater effectiveness.