20 Change Strategies:Choosing the right metrics

Dr. Mikel Harry told us that we will not know our answers until we measure, and we don’t measure what we don’t value. The real problem is what do we use to measure. The important factor here is how do we measure our processes? The key is that we choose the right metrics to do so.

You have got a choice to make. You can pick any old metric and end up with bad results or you can choose good, concentrated metrics that are aligned with your problem or issue. Let me dig deeper into that some more.

What is a business metric?

The website Techtareget (https://techtareget.com) tells us that a business metric is a quantifiable measure to track business processes to judge the performance level of your business or process. In other words, it is a way to discover how well we are proceeding on the path to removing the system constraints. The problem is that not all business constraints are of equal value. You have got a choice to make. You can pick any old metric and end up with bad results or you can choose good, concentrated metrics that are aligned with your problem or issue. Let me dig deeper into that some more.

What are bad metrics?

A bad metric is one that as an organization you can’t act on. It is some ways a vanity metric. You produce the metric because you think that it is a valid answer. The chosen metric is not even relevant to the issue at hand. It carries no meaning to the problem or for motivating the cross-functional team. These metrics have been developed because someone has told you to measure the processes without any guidance as to what to measure or how to measure it.

?What are good metrics?

As you develop your metrics you understand that you are involved within a human capital management scientific experiment. You must prove your measurement results. To do that a good metric clearly indicates where you are in relation to the organizational goals. In order to create good metrics, they must be evidence-based in nature. This means that good metrics can always be improved as indicated by the metric results. It also shows us where the improvements must be made. The good metric results also measure our progress to reach the goal.

?Criteria for evidence-based good metrics

In order to be considered as evidence-based metrics, they must meet four criteria. Each metric measurement must be creditable, they must be verifiable, they must be repeatable, and they must be reliable.

For an evidence-based criteria to be considered creditable they must be from any sort of bias and evidence-based. This means that as an organization any measurement must be free from any pre-conceived belief as to the outcomes. The outcomes are what they are and need to be accepted as such.

For evidence-based criteria to be considered verifiable they must be accurate and free from inconsistencies. If we perform the same measurement more than once it should come up with the same results. The results measuring the same process should be as identical as possible. The way we measure the process should be the same.

For evidence-based metrics to be repeatable means that if today we perform a particular measurement and then must perform the same measurement a month from now, we should come up with nearly identical results. This is based on the objectives of the two processes should be the same or nearly the same. The tasks used to make the measurements should also be comparable along with the process scope and schedules (milestones). The same goes for required resources.

Fir evidence-based metrics to be considered reliable the cross-functional teams can’t take shortcuts to reach quality. This means the data must be complete and totally accurate.

?Choosing the right metrics

Wayne Cascio in his book, Investing in People: Financial Impact of Human Resource Initiatives (https://www.amazon.com/Investing-People-Financial-Resource-Initiatives/dp/1586446096/ref=sr_1_1?crid=312OHAH6XNG80&keywords=Investing+in+people&qid=1677770303&sprefix=investi%2Caps%2C2075&sr=8-1 ) suggests several strategies to achieve the right metrics.

Strategy #1: Use the right Measures

We talked about the criteria for good metrics above. Make sure that your chosen metrics fit the criteria. Define the business case of the process improvement effort and make sure you are using the right metric accordingly. Understand what the definition of the cost of poor quality is.

Strategy #2: Use the right analytics

It is great to have good metrics in place, but what do you do with them. It means using the metric data to draw the right conclusions. Whether we are talking about the scientific method, or the DMAIC process one critical stage is to analyze the data we collected. Make sure that the data is applied to the right process. Equally make sure that the data analysis is applied to the right outcome. Use this analysis to create a prototype of your new process. The basis for metric analysis is to identify how it performs using process maps and value stream maps.

Strategy #3: Use the right logic

The logic presents the story behind what you are trying to achieve. The story represents the rational strategy behind what you are trying to achieve and measure. It means performing a SWOT analysis of your organization. It means understanding what your competitive advantages and disadvantages are and being able to explain them in plain terms.

Strategy #4: Use the right process

?Like within the Toyota system, your processes must be designed around learning and the gaining of knowledge. Once again you can if you try develop a wide assortment of data points. It is critical that you select only those data point which are directly attributable to the process problem at hand. Eliminate those data points that are not valid to the process.

?Next week we will look at strategies regarding organizational alignment

About the author:?Daniel Bloom?knows HR and Change Management. He’s a speaker on transformational HR, a strategic HR consultant and trainer. He is certified as both a Senior Professional in HR and as a Six Sigma Black Belt. Dan has written 7 books, more than 40 articles and has been in the HR social media space since 2006. Dan is currently the CEO and Change Maestro of?Daniel Bloom & Associates Inc., where?he helps organizations empower organizational change within their organizations.