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