This is a ridiculously common thing in companies that live and die by KPIs.

They'll agree on a set of measure that supposedly incent the behaviours they want to see, but don't actually think about those incentives' having feedback loops or unintended consequences, and because there's no small amount of executive pride wrapped up in them, they wont go back and revisit their mistakes.

Loblaw does this a lot, by the way. Example: I've dealt with their procurement support team, and one of their metrics is minimizing the number of "clicks" it takes to purchase something from a vendor, which is admirable, but Loblaw took this to the extreme and actually breaks purchase-price-verification because this would take extra clicks, and the number-of-clicks was more important than the integrity of the buying process.