Management

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Driving Change Through Performance Measurement

Former Hewlett Packard chief executive John Young once said, “You can’t manage what you can’t measure.” Indeed, how can you know whether you’ve reached your business goals if you don’t measure your criteria for success?

Adopting a performance measurement system doesn’t have to be a complicated process, and it’s a great way to give your business, and your team, the direction it needs. Here are some tips to get you started:

State your business’s goals

List 3 to 5 high-level goals for your business’s major operations, e.g., sales, design, production, information systems, customer service. These goals should be quantifiable wherever possible.

Review existing measures

Once you’ve identified your business’s goals, review your existing measures to see whether they fit with what you’re trying to achieve. Find what gaps there are between what’s being measured and what should be measured.

Establish new measures

This may sound like a big job, but most companies find they can continue using 50% to 75% of their existing measures with only minor adjustments. Decide how the new measures will be used.

Design the New System

Determine what data needs to be collected and how. Decide how often it should be gathered and by whom. Flexibility is important in the early stages of implementation — don’t start rewriting your practices until you’ve spent time working out the kinks.

Implement the New System

Collecting data and measuring outcomes is a waste of time and money if the information is never acted upon. Let your team know the performance measurement results and your expectations for the next measurement period.