Doug Hughes had an interesting response to this question that I thought
would be nice to share (with his permission):

I kind of approach it as analogous to networking.  latency and throughput in
the right combination. Users want the fast/simple stuff to be done fast, and
if it is, they give you a lot of leeway on the slow/hard stuff. Getting the
right balance is tricky, but manageable with guidance. Also, having
persistant throughput on projects is useful to measure. If you can see
consistent progress on something from a week to week perspective, that's a
good sign. One project might be stalled on something, or interrupted for
higher priority work, but overall there should be noticeable throughput over
time and tasks.

Every organization also has some other higher level goals that management
sets for everybody, like, meeting attendance (showing up promptly, being
prepared), whether people are part of the hiring process or not and how much
they participate, filing expenses on time, etc. It's easy to notice a person
who has a pattern of being late and unprepared, or inability to finish
projects, or missing details, or whatever

Many places have formal checklists. They predict a list of major projects
(those that are expected to last for months or years), and set those as
specific performance criteria at the review. Others collect the list of
projects accomplished during the year and the relative success or current
state (is the documentation done?) Some also have peer review as a formal
component..
   Doug
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