Some good points, bad logic. The fact that you can't effectively measure something doesn't mean that something doesn't exist.

Individual productivity exists.

Maybe it's easier to measure groups' productivity? Probably.

"Business impact"? I don't think so, that later concept seems much more arbitrary. But feel free to look for the keys under the lamplight. If you choose that metrics, you're not going to retain many extra productive people anyway.

The old problem: judging the work of an expert is very difficult if you lack comparable expertise. I can give you advice, but I can't make you smart to accept it. How could you tell if I'm a genius or an overconfident asshole?