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Measuring for Success
John H. Lingle said “You get what you measure. Measure the wrong thing and you get the wrong behaviors.”
To get the correct business behaviors, the opportunity is to focus on the basics of where you are, where do you want to go, how do you want to get there and what are the indicators of success along the journey.
Let’s focus on some of the measuring for success basics:
Envision the Future: The first step is to understand where you are from the perspective of your Customer and Key Stakeholder communities. Next is to determine where you want to be at some future point, say 12-36 months out. From there you develop a set of specific areas of focus and resource allocation, known as strategies which are designed to build a bridge between the current and future states.
Establish the Plan: Each strategy should have a Key Performance Indicator, or set of KPIs, established reflecting the critical few measureable characteristics of achieving the strategy. Strategies should have activities established, known as goals or objectives, that are specific, measureable, attainable, realistic and time based. Each strategy and each goal should have a specific person, known as a Sponsor, who is in accountable to achieve the planned and measureable activity.
Measure and Manage Results: The key with measures is that less is more. A plethora of data, reports and measures will not create the focus that is needed. Knowing where to measure is critical in developing management leverage and results.
Sponsors may use a variety of means to measure and reward expected versus actual behaviors throughout the business lifecycle. Some organizations use scorecards, others use dashboards, and still others, a collection of both.
The terms scorecard and dashboard are not interchangeable. Scorecards would be used by the Strategy Sponsor to assess a blend of strategies and results. Whereas, the Goal Sponsor might use Dashboards to see real time results on a regular basis. Scorecards are meant to be a collection of measures to determine if the company is on track to achieve the strategy. The dashboard is meant to be a graphical display of various measures reflecting the status of specific goal or strategy performance.
Sponsors are responsible for taking remedial action if results are not aligned with the anticipated performance as measured by the KPI at that time. Compensation, and incentive programs, should be aligned with the strategy and goal programs to drive the desired time-based activities.
In closing, measuring for success is not in and of itself a difficult process. The opportunity is to understand where you want to go, what it will take to get there, how best to position your resources for a successful outcome, what few measures ensure you are on-track to success and how to predict and mitigate circumstances that might arise.
Does all of this sound confusing? Call the professionals at ASIL, Inc. to help you clarify your direction, goals, and measurements to ensure success on your journey to increased profits.
Contributed by Warren White
June 2008 Spotlight
Service – Does it really matter?
Have you ever experienced a situation where the weather impacted your flight plans or a guaranteed early arrival room wasn’t available or a part that you needed was out of stock? If you exist on this planet likely you have experienced all three of these situations many times. Let’s face it, we can’t control the weather, rooms do sell out and people stay longer, and planning for every part requirement would be too costly.
The way we handle these challenges as consumers is directly tied to the Service element of the transaction. If we are treated with respect and feel that someone really does care and is willing to do everything within their means to help solve for us, most of us will accept the situation and even feel better. Yet when we are faced with indifference after a long day or dealt with in a condescending manner it becomes very difficult.
We no longer become focused on the original issue. Recognizing that there will be no immediate solution, the problem begins to shift and refocus. It is now about the Service experience. As customers we expect that service is a fundamental ingredient to be successful. We can all recognize good service when we see it, and we all know how it feels when it is not there.
I recently conducted a small poll and the results were astounding. Eight out of ten people were able to call to mind three or more recent bad experiences, in less than one minute. The stories ranged from restaurants, rental cars, hotels, retail, airlines, and more. What can we do?
If you are not satisfied, voice your feedback in a constructive way by using the company's complaint forum. Don’t get caught up in the moment, rather take the time to gather your thoughts. Most companies take service very seriously and they want to know when you are not having a good experience. They understand that you will tell many more people about your poor experience, which will impact future revenues.
So take charge and share your perspective. That reminds me … I need to send a message to US Air, Holiday Inn, and Leslie Pools.
Contributed by Peter Pazmany
Industry Trends
Chinese Competition Increasing
According to respondents to a recent McKinsey survey of corporate executives, China is seen as having a competitive advantage as far as price. However, a surprising number of those executives around the world view Chinese companies as weaker competitors than companies from other countries. Besides lower prices, companies in China have little to offer global markets, say respondents, who particularly dismiss Chinese product quality, marketing skills, and brand strength. From the Chinese perspective, the results suggest that low costs will go and that moving up the value chain is more important than ever.
A perception that Chinese companies are laggards might explain why many executives report mounting a muted business response to Chinese competitors, at best. For example, only 28 percent of the executives who responded to the survey say they work for a company that has changed its approach to sourcing a great deal over the last three years, compared with 40 percent reporting a little change and 29 percent reporting none. More respondents report that their companies tweaked the organizational structure (46 percent), marketing (44 percent), and global strategies (43 percent), but in each of these areas, less than 20 percent report significant changes. This lackluster reaction to the global ambitions of China’s companies raises the question of whether business executives elsewhere are setting themselves up for some unhappy competitive surprises.
The responses to the survey also suggest that executives expect their Chinese competitors to nibble away at the global revenues of their companies. Indeed, 80 percent expect competition from companies in China to increase over the next three years. And although about two-thirds say companies based in China have had no impact on the global revenues of their own companies over the past three years, almost half expect to take a hit in revenue over the next three.
It seems to us that Japanese companies in the past were in this same market position and they took advantage of slow responsiveness to build their strong global presence. Are we to see Chinese companies emerge as global competitors while U.S. companies continue to lose market share? ASIL, Inc. can help drive change in companies and organizations through their Driving Complex Change® methodology in order to keep you competitive with both local and foreign competitors. Contact the “Consultants That Deliver” today at ASIL, Inc.
Contributed by Michael Singleton
Our Software Products
Click on the links below to view ASIL, Inc.'s MAX Partnering® self paced software demonstrations:
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Self Assessment Sample Questionnaire - This demo will enable you to respond to a small sample of self assessment questions focused on change management and create a Heat Map of your responses to see areas that may need attention. The Driving Complex Change® methodology addresses the six areas of Direction, Ability, Incentive, Resources, Structure, and Action that can impact your effectiveness of change management.
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