Beneath the Rind: Peeling Away the Watermelon Effect in IT Services

“You can’t manage what you can’t measure,” they say. What if you measure something, but eventually can’t manage it to achieve customer satisfaction? Let’s talk about the reliability of KPIs in IT service management.

Illustration of the watermelon effect in IT, showing a watermelon with charts and graphs inside..

Remember the last time you gave a taxi driver 5 stars, even though they were kind of a jerk? We often do this to save time or avoid causing trouble. This is an example of the watermelon effect: the rating looks good (a 5-star review), but the customer experience is not truly reflected (the rating should be red). Congratulations, you’ve just given the company management a false impression of your satisfaction level!

This is how it looks in IT service management:

  • Technicians report that 100% of licenses are updated (even when they aren’t). ->
  • The manager believes the licenses are secure and approves their rollout to a new department. ->
  • Because a security patch isn’t applied, hackers exploit the vulnerability, leading to a public data leak.

The inconsistency is dangerous because it hides issues that can lead to major disasters. Let’s learn how to prevent this effect and recognize if it’s already impacting your team.

What is the watermelon effect and how is it connected with SLAs?

The watermelon effect refers to a phenomenon where performance indicators appear favorable on the surface but reveal issues when examined more closely.

This term is often used to describe a situation where external measurements, like service level agreements (SLA) or performance reports, show a “green” status, indicating everything is fine, while the reality is “red,” indicating problems and dissatisfaction. Similarly, a watermelon is green on the outside but red on the inside.

While the effect’s name is primarily associated with IT service providers, it is relevant to any field where management relies on reports to evaluate the performance of their employees.

In IT, this term is frequently used in areas like IT outsourcing, where service providers may report achieving SLAs on all fronts to their clients, even though the actual work or end-user satisfaction is poor.

How do you know you’re experiencing the watermelon effect?

Often, you don’t need special knowledge to recognize that your numbers are misleading; negative feedback from end-users can be a clear sign. However, here are some less obvious signs that IT support might not be delivering results to users despite green numbers:

  1. Use of personal technology: Employees might start using their personal devices instead of the tech provided by the company. For instance, if employees use personal laptops because the company-provided ones are slow, unreliable, or not up to date with the recent trends, it signals dissatisfaction with IT services.
  2. Self-purchased subscriptions: Another sign is when employees purchase their own software subscriptions or tools because it’s simpler and more efficient than relying on raising requests with the IT department.
  3. Low utilization of IT services: If some IT services or platforms seem underused, it might mean employees don’t find them useful or effective.
  4. Employees avoid raising requests to IT: When employees prefer dealing with issues on their own instead of talking to the guys you pay money to fix them, it’s a clear sign of trouble.

Should I worry about the watermelon effect? Metrics are never perfect!

People aren’t perfect, and KPIs aren’t perfect either. The fact that dashboards don’t show the real picture isn’t always a problem.

For example, in a small team, even if there is a formal service request procedure, the service requester and the technician might reach a verbal agreement and not create a ticket. Since they work on the same floor and are both too busy, they might skip filling out another form. As a result, the technician’s manager won’t see the details of this case in the reports.

If the manager knows that the numbers he sees don’t cover every case and doesn’t mind it, then the mismatch isn’t a problem.

However, this effect becomes a problem when managers rely on measurements that don’t reflect reality to inform their decisions. The watermelon effect might then prevent management from addressing real problems, misguide decision-making, and leave the company unprepared for emergencies.

Alloy’s comprehensive IT service management and IT asset management solution allow you to measure the performance of your IT support team and track key metrics and trends in your IT processes.

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What are the reasons behind the watermelon effect?

Here are some reasons why the mismatch between reported performance and the real performance might happen.

  • Outdated or poorly selected performance indicators.
    • Outdated SLAs, especially in long-term service contracts, can cause trouble. To prevent this, it’s important to include regular updates of the KPIs in the contract.
    • If the metrics weren’t chosen properly, they are flawed from the very beginning.
  • Subconscious bias: People naturally tend to highlight the positive results of their work and downplay negative outcomes. This isn’t always done on purpose; it often happens without them even realizing it.
  • Cultural issues: In some companies, employees are afraid to deliver bad news because management punishes them for it. This fear makes people hide problems and report only good news, leading to misleading metrics. A notable example of this is the Chornobyl disaster, where a culture of punishment for reporting issues led to the biggest nuclear catastrophe in human history.

How to prevent the watermelon effect or fix it if it’s already there?

Intentional focus on gray zones

Since people naturally tend to highlight positive aspects and hide negative information, special effort is needed to discover and monitor areas that present risks.

If you’re a manager reviewing reports, assume you’re seeing the best metrics while failures are hidden. If you’re an employee preparing dashboards, intentionally focus on weaker parts of your processes.

Here are some practical tips for focusing on gray zones:

  1. Anonymous feedback channels: Set up anonymous feedback channels where employees can report issues without worrying about backlash. This encourages honesty and helps uncover hidden problems.
  2. Balanced reporting: Make sure your reports show both the good and the bad. Use a structured format that highlights challenges and how they were tackled.
  3. Scenario planning: Run scenario planning exercises to simulate potential risks and their impact. This helps your team prepare for unexpected challenges and keep things transparent.

A culture of transparency between technicians and business stakeholders

Fostering transparency involves listening to employees. Technicians should feel encouraged to share both positive and negative results, knowing they won’t face backlash.

XLAs

The key advice to those fighting the consequences of the watermelon effect is to shift focus to the end-users’ real expectations, requirements, and wishes.

One of the tools is the so-called XLA—experience service agreement. XLA is a framework that helps service providers deliver better end-user experience by collecting user experience data.

Within SLAs, the most popular metrics are service uptime, availability, and response time. XLAs, on the other hand, prioritize metrics such as customer satisfaction and overall service perception and use qualitative data, like survey results and user interviews.

XLAs help the service provider understand what the user feels when using the service.

Challenges when implementing XLAs

As always, there’s no ideal solution.

Shifting to an experience-centered approach like XLAs comes with its own limitations.

  • Mainly, while improving and standardizing XLAs, there’s a risk of making them too abstract and detached from reality, repeating the issues of traditional key performance indicators.
  • People’s opinions are naturally subjective, which makes it tricky to keep feedback and ratings consistent.
  • In an effort to improve old metrics, there may be a tendency to collect too many metrics to get a “more comprehensive” view. Over-reporting can make it difficult to interpret the data effectively.
  • Finally, employees who are accustomed to traditional metrics might resist transitioning to an experience-centered approach. Read our article on preventing employee’s resistance to change.

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Key takeaways

  • The “Watermelon Effect” describes a scenario where performance metrics appear favorable on the surface but hide underlying issues. For example, a taxi driver might receive a 5-star rating despite poor service.
  • This effect can obscure real problems, misguide decision-making, and leave organizations unprepared for emergencies.
  • The key reason for the mismatch between numbers and reality are cultural issues where negative feedback is discouraged, and the user’s experience isn’t monitored.
  • To combat this, organizations should focus on real user experiences and foster transparency among employees and management. One practical framework for this is the experience level agreement (XLA).

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