With operation metrics, putting the cart before the horse can really pay off…

Often companies stall to create metrics to measure team performance because the operating data they have does not exactly match the numbers they want.  However, as Jeanne Ross, director of MIT Sloan School’s Center For Information Systems Research points out in this weeks InformationWeek article, creating a single-vision of data within your company “doesn’t have anything to do with accuracy – it has everything to do with declaring it” as the central go-to number.

Her view is that teams spend far too much time “collecting, cleansing, and perfecting what they think is “the right data” to measure, instead of actually tackling the underlying business problem itself.  The real value is therefore in starting with some number – any number – to begin to understand how likely you are to run out of stock, how often you fulfill orders “on time”, how long does the average customer service request take to resolve, and so on.  In other words, it does not matter if you cannot simply calculate those numbers.  Instead, you may need to look at several other, related or relevant numbers, that you have access to right now in order to make proper inferences towards the business challenges you seek to resolve.

As a driver of the Management By Exception philosophy for our customers, we at Traction agree that it is always better to “start measuring now – something, anything” instead of the continual discussions that take place, which focus more on the topic of “the measurements that we don’t have” versus the one’s we actually do have.  By shifting to a “good enough to start with” mentality, companies can break free of this cycle, and instead of waiting for data they don’t have, they can focus on the data they do have – and create new ways right now to drive improvement, innovation, and performance.