{"id":16914,"date":"2020-10-17T16:07:00","date_gmt":"2020-10-17T20:07:00","guid":{"rendered":"https:\/\/www.shortform.com\/blog\/?p=16914"},"modified":"2020-10-31T23:45:10","modified_gmt":"2020-11-01T03:45:10","slug":"system-goals","status":"publish","type":"post","link":"https:\/\/www.shortform.com\/blog\/system-goals\/","title":{"rendered":"System Goals: How to Choose Your Metrics"},"content":{"rendered":"\n<p>Why are system goals important when you&#8217;re developing a system? How can optimizing for the wrong goal cause your system to fail? <\/p>\n\n\n\n<p>System goals are a necessary part of any system. But in order for the system to succeed, you have to make sure you&#8217;re working toward the right goals.<\/p>\n\n\n\n<p>Read more about system goals below. <\/p>\n\n\n\n<!--more-->\n\n\n\n<h2 class=\"wp-block-heading\">Setting System Goals<\/h2>\n\n\n\n<p>As you develop your systems, you need to set system goals. It&#8217;s also important to make sure you&#8217;re setting the right goals.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Optimizing for the Wrong Goal<\/strong><\/h3>\n\n\n\n<p>Also known as: \u201cBe careful what you wish for.\u201d<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>How It Happens<\/strong><\/h4>\n\n\n\n<p>Optimizing for the wrong system goals is the conceptual opposite of rule beating. Here, a goal is defined incompletely or inaccurately, so that <strong>progress toward the goal doesn\u2019t lead to the desired result<\/strong>.&nbsp;<\/p>\n\n\n\n<p>This can happen:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>If the goal is measured incorrectly, and the wrong metrics are optimized for<\/li><li>If the goal doesn\u2019t reflect what the system\u2019s stakeholders really want<\/li><\/ul>\n\n\n\n<p>A system is often so good at achieving its goal that it can march steadily toward that goal before anyone realizes they never wanted that goal in the first place.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Examples of Optimizing for the Wrong System Goal<\/strong>s<\/h4>\n\n\n\n<p>A common theme is confusing motion with progress.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>If a country\u2019s national security is defined as national security spending, you will get national security spending. You may or may not get actual national security. In fact, national security might be worse, since the <a href=\"https:\/\/www.shortform.com\/blog\/us-defense-spending\/\">defense spending<\/a> detracts from investment elsewhere.<\/li><li>If education is defined as standardized test results, you\u2019ll get standardized test results. You may or may not actually get an educated population.<\/li><\/ul>\n\n\n\n<h5 class=\"wp-block-heading\"><strong>Gross National Product<\/strong><\/h5>\n\n\n\n<p>National governments fixate on gross national product (GNP) as a key metric. The higher the growth rate, the better. But GNP is woefully incomplete in describing the welfare of the population. It measures the value of the goods and services produced; it doesn\u2019t reflect happiness in a family, the quality of our <a href=\"https:\/\/www.shortform.com\/blog\/political-discourse\/\">political discourse<\/a>, or social equality.&nbsp;<\/p>\n\n\n\n<p>Counterproductively, GNP rewards inefficiency\u2014car accidents increase GNP through medical bills and buying new cars; a new lightbulb that costs the same to manufacture but lasts twice as long decreases GNP. GNP measures throughput (the production rates of things) rather than capital stocks (the houses, computers, and things that constitute wealth).<\/p>\n\n\n\n<p>Imagine a world where instead of competing for GNP, countries competed for the highest ratio of capital stocks to throughput (rewarding efficiency), or for the highest healthy life expectancy.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Fixing the Wrong Goal<\/strong><\/h4>\n\n\n\n<p>Create system goals that lead to the intended result. Choose indicators that show the welfare of the system, not a narrow slice of its output. Don\u2019t confuse motion with progress.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Why are system goals important when you&#8217;re developing a system? How can optimizing for the wrong goal cause your system to fail? System goals are a necessary part of any system. But in order for the system to succeed, you have to make sure you&#8217;re working toward the right goals. Read more about system goals below.<\/p>\n","protected":false},"author":5,"featured_media":16921,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[45,81,14],"tags":[139],"class_list":["post-16914","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","category-economics","category-management","tag-thinking-in-systems","","tg-column-two"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v24.3 (Yoast SEO v24.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>System Goals: How to Choose Your Metrics - Shortform Books<\/title>\n<meta name=\"description\" content=\"All systems need system goals. But what goals should you set, and how can those goals go wrong? 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