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Too Many Measures Steve Stanton, Managing Director
Webinar January 27, 2016
For more informa6on, go to fcbpartners.com or call Lindsay Field 617.245.0265
1 ©2016 FCB Partners. All rights reserved.
On the One Hand: Measurement Excellence
• A few clearly defined key measures - end-‐to-‐end and “in process” - balanced across domains and stakeholders
• Well-‐thought out performance targets
• Precisely ar6culated data sources and formula6ons
• Well communicated and understood
• Drive produc6ve ac6on
2 ©2016 FCB Partners. All rights reserved.
• The first step is to measure whatever can be easily measured - this is okay as far as it goes
• The second step is to disregard that which can’t be easily measured - this is misleading
• The third step is to presume that what can’t be easily measured isn’t important - this is blindness
• The fourth step is to say that what can’t be easily measured really doesn’t exist - this is suicide
And On the Other Hand…
Source: Charles Handy
3 ©2016 FCB Partners. All rights reserved.
Why Is Measurement so Difficult?
Requires deep insight
how value is created across a complex organiza6on what customers really want what other key stakeholders really want how to translate the organiza6on’s strategy into ac6on In addiBon the environmental trifecta of complexity, novelty, and speed digi6za6on provides even more opportuni6es we’re now entering the age of data-‐driven decision making intui6on and history are no longer enough the plague of busy-‐ness
4 ©2016 FCB Partners. All rights reserved.
The Four QuesBons
• Why measure? - what’s the purpose of measurement?
• What to measure? - what are the few key metrics?
• Where to set performance targets? - what do key stakeholders want?
• How to measure? - what are the best techniques and tools?
5 ©2016 FCB Partners. All rights reserved.
Why Measure? The primary goal of measurement is to improve business performance
– by understanding how stakeholder value is created
The primary role of measurement is to reduce uncertainty by using data
– perfect certainty is rare
The primary use of measurement is to help you get where you want to go, not just tell you where you’ve been
– it’s a business issue, not just a financial one
An important by-‐product of measurement is to reduce complexity – and focus on what’s important
A primary output of measurement is communicaBon – it’s how we tell everyone what’s important
6 ©2016 FCB Partners. All rights reserved.
Why Measure? (…con:nued)
You must know what you want to measure and why, before you worry about how - establishing causality and controllable outcomes
Processes are the key inflecBon point of an organizaBon - transla6ng ambi6on into ac6ons - linking enterprise goals to task goals - avoiding func6onal silo approaches
Strategic clarity and deep business understanding must precede measurement
7 ©2016 FCB Partners. All rights reserved.
What to Measure? � All measures are derived from strategy
– from enterprise to process to performer – it’s always tops down
� A metric architecture model is needed – focused on control-‐ability and ac6on-‐ability – based on hypotheses and experimenta6on over 6me
� Most measures have liTle value – focus on the few big ones (80/20) – measure as li]le as possible (it’s NVA)
� Create a balanced scorecard for every process (+/-‐7) – mixing across stakeholders – mixing stakeholders
8 ©2016 FCB Partners. All rights reserved.
• What are key stakeholders demanding? – external: customers, regulators, suppliers – internal: Execu6ves, performers, internal customers
• How well are analogs (BP) performing?
• What does financial viability require?
• What does our intui6on indicate?
• What would ins6ll ambi6on in front-‐line teams?
Se[ng the Right Performance Targets
9 ©2016 FCB Partners. All rights reserved.
How to Measure
Perform process
Improve Measure
performance
Determine acBon
Interpret results
Communicate
Develop causal model
IdenBfy and define
key metrics
Develop performance
targets
Strategy Change:
measure, target, or process
10 ©2016 FCB Partners. All rights reserved.
FCB 2016 Public Courses
Event Dates and LocaBons
Process Redesign Hammer Cer:fica:on Course Coconut Grove, Miami FL, February 2-‐5
Process Owners in AcBon Advanced Hammer Cer:fica:on Course Coconut Grove, Miami FL, February 3-‐5
Change Leaders and Catalysts Advanced Cer:fica:on Course Arlington, VA, April 4-‐5
ImplementaBon and ExecuBon Advanced Cer:fica:on Course Arlington, VA, April 6-‐7
Process Redesign Hammer Cer:fica:on Course Arlington, VA, April 5-‐8
Power of Process Hammer Cer:fica:on Course New Orleans, LA, October 24-‐25
Leading TransformaBon Hammer Cer:fica:on Course New Orleans, LA, October 26-‐28
11 ©2016 FCB Partners. All rights reserved.
For More InformaBon FCB Partners
Lindsay Field, Program Director
617 245 0265 lfield@fcbpartners.com
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