Metrics

Metrics Defined

A metric is essentially a standard measure to assess your performance in a particular area. Metrics are at the heart of a good, customer-focused process management system and any program directed at Federal Governmentcontinuous improvement. The focus on customers and performance standards shows up in the form of metrics that assess your ability to meet your customers' needs and business objectives.

Metrics Applied

The development of an important set of metrics is critical to any successful performance management initiative. However, developing and publishing the metrics is only the beginning. Metrics must be owned; meaning the owner must be held accountable for the performance of each metric. Ownership and accountability, of the metric allows for the highest probability of success.

When developing metrics, a smart approach is to focus metrics according to the following:

  • Process metrics vs. function metrics: Most metrics are functionally based and therefore optimize functional performance, often at the expense of total enterprise performance. Process metrics solve this problem by measuring what is most important to the enterprise. Holding managers accountable to process performance metrics is critical for breakthrough performance improvement.
  • Hierarchical metrics: Key metrics need to be hierarchically linked from senior management down through lower levels in the organization. This ensures alignment of both objectives and behaviors.
  • Driver metrics vs. results: Traditional performance metrics, especially financial ones, are results metrics. In general, they cannot be improved by direct action, but rather require an action to improve some aspect of the process that drives them. When the driver of the result is well understood, it is usually possible to identify a metric that can be directly influenced by specific behaviors or process changes. We refer to metrics like these as drivers, because we know that when they get better, the results will get better as well.

Ideally, in a performance management effort, the goal is to move the organization forward or even change the corporate culture. This can be accomplished by setting appropriate goals; to be effective; each metric should have one of those goals associated with it.

Metrics at Thomas Group

Which are the most important metrics? At Thomas Group, we are convinced that the best metrics by which to determine both the horsepower and energy efficiency of a client’s economic engine are quality produced the first time (first pass yield) and the time it takes to complete a defined cycle of learning (cycle time). Whatever the given metrics, they must be consistently applied so that patterns and trends can be correctly monitored and, wherever necessary, changed.