What gets measured gets managed. But be careful what you measure so that your employees don't have the opportunity to play with what you are managing.

One of the performance metrics the authors established for its 2,000-person national field maintenance organization was the number of workorders completed.  Because workorders were handled through a real-time nationally accessible database, and once entered, no one could massage the data, we thought this would be one of several good measurements for our team.

And for a while, the metric was viable--until many in the field figured out a way around.  What they did was, instead of placing a workorder to fix three broken urinals in the same restroom, they would instead input three separate workorders, each for one broken urinal.  It was a productivity bonaza, until we figured it out.  We quickly eliminated that metric, and instead looked at percentage of workorders completed.  We then measured the field managers on their team's productivity against standard.  (This forced them to understand why certain field technicians were posting unrealistic productivity efforts.)

Performance metrics are essential.  They inform team members of your expectations and tell them what levels must be achieved to be deemed successful.  Just make sure what you want to measure will produce the anticipated results.