Metrics are useful, essential even. If you want to track the progress of a project you need some way of measuring it. If you want to be able to improve you estimates for the next project bid, you need to be able to figure out what happened to the last one. It's even useful as a management tool, right down to individual employees.
But announcing your metric and using it to directly reward or penalise employees is just stupid and not a proper reflection on metrics. It's like pouring coke in your eye and then claiming coke isn't good for anything.
Metrics provide a view into whats happening and allow you to gain insights into the process. Take lines of code, a widely reviled metric. You have two employees, one creates 4x the average number of lines of code, one creates 4x less than the average. The wrong next step is to praise the first employee and penalise the second. The right next step is to look into it further and figure out why. Is one producing standard template code like accessors while the other tackles hard problems, if so, is this desired? Does one have considerably superior tools allowing them to work faster? It may be that one coder isn't up to pace with the rest, a manager needs to be aware of that so that they can work around it or address it, but not by telling them to write more lines of code.
What I'm trying to get at is that they are indicators, like the smell of food suggests it's taste. A broad range of metrics provides an indication of the life of the project. However they should be triggers for further investigation, like system monitoring for a computer system. A manager should never should never use a metric to justify a decision. Employees shouldn't be aware of the metrics being used around them, not because it's a secret but simply because they shouldn't have to care.