Successful businesses must deploy resources to build the capabilities most needed to serve the customers well. The best practical way is to measure results that the business aims to achieve. This involves clearly defining the outcomes implied in the business strategy. Therefore, performance metrics must measure the right things. Answer the following ten questions about your metrics:
1. How well do the metrics correlate to your business goals?
2. Do the metrics measure the outcomes you aim to achieve? Are you clear on what results to work toward?
3. How did you select what metrics to use?
4. How many metrics do you look at regularly?
5. How many metrics are finance-related?
6. Are statistical data included as performance metrics? What is the purpose of having that data?
7. Do you measure the results of critical activities that drive the target outcomes?
8. Do you focus on activity milestones rather than results of those activities?
9. Can employees relate their work to the business goals? Is there a clear line-of-sight that everyone understands the impact of their decisions and work?
10. Do the metrics incent the desired behaviour?
© Connie Siu 2012. All rights reserved.