Measurement Missteps

Measurement overloadAlthough I don’t get to do it nearly as much as I used to, one of my favorite parts of my job is helping organizations determine how to create their objectives and KPIs.  My focus is on strategy articulation, not strategy formulation.  While other expensive consultants help organizations figure out where they should go, I use performance management techniques to make sure that everyone goes in the same direction.

As such, I often get asked to help out when employee behavior doesn’t match management direction, even though formal goals and metrics have been set.  In my experience this is often because the wrong metrics are chosen – metrics are based on what data is available or the activities being performed, rather than the outcome that needs to be achieved. Last week’s posting is an example: by using the measure ‘% of best practices posted’ rather than ‘average # of people downloading that individual’s best practices’, the manager unintentionally encouraged his employees to create many short documents rather than ones that would be used by others.

Another good example is my classic Dirty KPIs post in which I showed that an activity metric like ‘# of miles of streets cleaned’ tracks an internal process objective and doesn’t ensure that any streets get cleaned. On the other hand, an outcome measure such as ‘# complaints about street cleanliness reported every quarter’ represents the customer (citizen) point of view and directly measures one of the objectives for the street cleaning program.

You’ve told me that these stories are useful tools for your own performance management journey. I’ll be blogging more of them and, since this is a community site, I encourage you to send me your stories of measurement missteps. I’ll be sure to keep them anonymous.

Trackbacks/Pingbacks

  1. Prioritization « Manage By Walking Around - May 10, 2009

    […] I’ve railed on the problems with bad measurements, I haven’t spent as much time talking about the challenges of poor prioritization.  In most […]

  2. What’s Missing from your Balanced Scorecard? « Manage By Walking Around - June 7, 2009

    […] Mark’s article provides a great example of measurement missteps at a fried chicken franchise.   By focusing on an efficiency metric at the expense of customer […]

  3. Quick Guide to Performance Management « Manage By Walking Around - September 27, 2010

    […] In my experience most performance management practitioners don’t spend enough time creating the appropriate grading system that will help them understand (and explain) the size of the gap between actual and target.  Unfortunately, this oversight means many of their performance conclusions are faulty. […]

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