Posts Tagged ‘measuring performance’

Measuring may not be the thing that really excites you as a leader.  At the same time you probably have heard people say over and over again that what gets measured get’s done.  Any business that is serious about achieving results needs to measure performance.  So what are the 5 golden rules of measuring performance?

 

Rule 1: Be clear on what you want to achieve

 

If you don’t know what the end destination is just about any direction will be fine.  Yet the reality is that the clearer you can be about what you want to achieve from your business, the much easier it will be to develop and implement measures.  Taking the time to define in clear and straightforward what you want to achieve is similar to laying foundations for a house. 

 

Rule 2: Separate the things to do from the things that are critical          

 

Filling up your schedule with things to do is not difficult.  It is pretty easy to think that it is volume that matters.  As a leader, you know that what’s important is to be clear on the things that drive results rather than the things that fill up your schedule.  Do you know what those 5 critical things are in your organisation?

 

Rule 3: Watch out for those who focus on the data

 

Information is rarely 100% complete and accurate.  As a result people sometimes focus their time and effort in picking holes in the reports rather than the underlying messages.  Aim to keep people focussed on the big picture and key messages rather than the petty bits of detail.

 

Rule 4: Eliminate the “I thought” discussions

 

What do I mean by the “I thought discussion”? Basically it’s when 6 people have 4 different views on what a particular measure is telling them or how it is calculated.  To overcome this, make the basis of calculation and scope of any measurement crystal clear.

 

Rule 5: Focus on action

 

Measurement is only worthwhile if it results in choice and action.  Keep the focus on what the organisation is going to do as a result the information being identified from the performance measurement.

 

Bottom Line – Performance measurement can be a huge asset in achieving success as a leader.  The question is are you ready to leverage those benefits?

It might not be the most exciting thing that you do as a leader but achieving success relies on you having an effective system of measuring progress.  Think about it, if you are measuring something it is on your radar and if it is on your radar you are more likely to be alert to opportunities to move forward to the next level.

So how can you start to make measurement a valuable business tool rather than just a chore where you tick boxes?

Get clear on your goals
 
If you are going to be effective at measuring something you need to be crystal clear about what you are trying to achieve in the first place.  When designing any form of measurement system whether at organisation, function, team, project, process or even individual level, make sure you are crystal clear on the goals, results and outcomes you want.

Distinguish between the essentials and nice to have

In any organisation there are certain things that are so essential to your success that you really need to pay attention to them.  You probably have heard of the 80:20 rule.  In essence 20% of what you do delivers 80% of the results.  In any organisation it is vital that you determine what the 20% is and then focus your measurement around this area.   So what’s the 20% in your organisation?

Make everyone responsible

You may have people centrally who crunch the numbers or provide the reports but ultimately achieving goals needs to the responsibility of everyone.  The best systems of measuring performance were those that cascaded objectives and goals right down to individual employee level.

Don’t just rely on financial measures

Financial measures have their place and need to be part of what they measure but don’t rely on them in isolation.  The reason is that most financial measures are after the event.  They tell you retrospectively what has happened.  Take something like turnover (sales) as example.  Sure it tells you how much income you have generated from sales but the real nuggets are in understanding the drivers and blockers of sales.

Bottom Line – Measuring if it is to make a difference to personal and organisational success needs to focus on measuring what matters.  So what action can you take to use measurement to create more success?