How To Avoid The Levee Breaking Through KPIs
Books. There's all genres. Business. Nonfiction, Fiction, History, Current Events, Biographies, Mysteries and on and on. Whatever the genre there's nothing like a great book. They can entertain you, inform you of information you'd otherwise never know, challenge your thinking, and even change your life. Many people like to read so much that they'll take on multiple books at a time each serving a different purpose: one, current events; another, fiction; a third, history; a fourth, humor, etc. I suppose the thinking is that depending on their mood they've got a book to satisfy that moment's interest. If you're in this camp then you know you can easily end up bouncing from book to book, day to day slowly chipping away at each one.
Sound familiar to anyone?
The only problem is that over time you end up adding more and more new books to the already 'in progress' collection. As more and more books are added to your bedside collection eventually as Robert Plant from Led Zeppelin sings, "when the levee breaks" you sheepishly put one unfinished book after the other back on the bookshelf because you can't possibly ready all 20 or 30 books at once!!! At this point you've safely returned to your 3-books-at-a-time maximum only to repeat the overload cycle again in no time.
What if there were larger consequences for not completing these books?
Maybe there were some higher priority books that needed finishing over others? Maybe one of the books was a library book or a borrowed book with a timeline associated with it? Maybe some books were started because they were more fun to read than the less interesting ones with a time sensitivity attached to them? Maybe one was for a book club where there was a shared interest in its completion so they reader could add value to the reading group?
If any of these situations applied we are probably more likely to become extremely serious about one book over the other so we're essentially prioritizing our reading. Again, a harmless example but I think it's illustrative of the competing priorities we might have in our jobs too.
Well, why should it be any different when we're talking about our job-related actions? We are constantly having to prioritize our most important tasks or objectives, both long and short term. If the organization places critical importance on certain goals and objectives whereas everything else is considered less critical wouldn't the organization want to ensure the workers and the entire workforce is being measured against those goals and objectives on an ongoing basis so 'every chapter is read'?
A common way to measure and monitor this performance is through the use of key performance indicators, or KPIs.
A KPI allows an organization to monitor whether it is on track or not. KPIs serve to decrease the intricate nature of organizational performance to a small number of key indicators so as to make it more digestible for us to focus on the most important activities. KPIs are used in our personal lives too. Think of a doctor measuring things like blood pressure, cholesterol levels, heart rate and our body mass index as important indicators of our overall health. With KPIs we are trying to accomplish the same in the organizations.
Assigning the right KPI’s is less art and more science. For example, if a purchasing manager is being measured only by cost, they’re likely to start ordering in bulk and paying suppliers late. Good for the purchasing manager, bad for business. This is because the purchasing manager may have been ordering a lesser quality material, the inventory resulting from bulk ordering may outstrip any benefits from ordering in bulk, while the supplier relationships may suffer. Bad for business all the way around. The metrics by which people are measured drive their behavior so be careful what KPIs you select.
First, define your success measures. These might be, how well are we satisfying our customers? How well are we managing risk? …or innovating? …or managing our costs?
Then, you will want to define the KPIs that make up that success measure. The KPI might be willingness to recommend, customer retention or loyalty. Those measures can be converted into metrics which can have goals attached and history for comparisons. Once assigned through a collaborative exercise between the individual, their management team, and perhaps an outside consultant they can drive behaviors that foster the team effort companies relish. The employee is most likely going look at the drivers that can effect their measurements and see where the other influencers are in these measurements. It can force greater collaboration among these groups with a sense of “team” that never existed before. Suddenly, programs will spring up to ensure those measures go in the right direction. This is what accountability and ongoing measurement of what’s important will ensure these individuals will focus on the right things and evaluate their priorities as they go about their jobs.
Take a deeper look at the impact of measuring and monitoring performance through KPIs. It can make a difference in getting everyone acting with purpose-driven intent not roving around rudderless.
Get started with this in your enterprise through small successes.
...and, lastly, don't let the perfect be the enemy of the good. Translation: don't wait to implement this program until it's perfectly structured. Getting something in place that's good enough and use it as a 'test case' without ramifications for a single department or work group. Analyze the feedback and employee behavior, learn from it and adjust. Once you've got it right then expand from there.
Tim O'Bryan, AnalyticsZone at IBM
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