Monday, November 1, 2010
Many times when we are working on metrics projects, we are asked the question, "Which metrics should we be focusing on?" In other words which metrics are the ones that are tightly linked to measuring the desired business results? It is a valid question, but a difficult one.
I have a passion around HR Metrics but this discussion can apply to any organizational metrics, as I have had conversations with marketing, operations and sales professionals that struggle with WHAT to measure.
Below is a list of questions we have asked in the quest for making metrics matter:
1) Did you start your metrics journey by mapping your organizational strategy?
2) Do you use value metrics that are tightly linked to profits, revenue, cost or budget?
3) Is it a metric that is near and dear to your CEO's heart?
4) Does the metric stand the test of time? (it is used to gain valuable trending information)
5) Is it a metric that you take action on when it changes?
6) Is it a metric that can be used to be predictive?
7) Does the metric measure efficiency or effectiveness? Do you need both to tell the whole story?
After the questions above are answered, you can usually get a really good first "draft" of metrics that are candidates for the "ones that matter most."
I have been in many meetings where we started out with hundreds, yes I did say hundreds of metrics and reduced those to less than half...because they really didn't matter.
If I have learned one thing this year it is the importance to tell a story with your data. Context is crucial when you are reporting data. Data is just data until you tell a compelling story. Then data becomes insight which leads to better decision, better results, and a competitive advantage for your organization.
Ask yourself the questions above...how many of your metrics truly matter? I bet it's not 100!