Metrics_ How to Improve Key Business Results - Martin Klubeck [124]
“Two or three a year,” the priest answered.
“So if we do nothing, we'd achieve this goal?”
He nodded in the affirmative.
We eventually worked out a reasonable and measurable increase over the expected growth without making any changes. The purpose of the goal was to build up the parish. The purpose of the metric was to see if our efforts were successful. We had plans, ideas, and activities scheduled for the purpose of bringing in new members and bringing back parishioners who had fallen away. We needed to (1) set a goal to focus our efforts and ideas; and (2) set measures to tell us what worked and what didn't.
We also needed a benchmark. We could not determine if any of our efforts were producing the desired result if we didn't know the norm. Consider the benchmark in this case a “control group” or value. You have to know what you get if you do nothing different. Then, when you do new things in new ways, you can at least assume that any changes that you made caused the change to the outcome. Even if you implement so many changes that you can't determine what exactly worked or what exactly didn't work, you at least know whether the overall effort(s) worked.
So, benchmarks basically allow you to know where you are and, therefore, where you end up.
A benchmark is the starting line.
Even when a benchmark is used to compare you against your peers, it is essentially a starting line—a baseline to measure your progress against. The purest form of the benchmark is when you set it as an internal baseline (vs. an external comparison). This allows you to measure progress.
Set Benchmarks Responsibly
Benchmarks falter from time to time when leaders want to use the comparison benchmark as the baseline. Most times, it starts with something like, “Can you get our competitors' average availability, response time, or customer satisfaction ratings so that we can compare ourselves to it?”
This requires that the performance of your competitors is a good starting point.
My simple and first argument against chasing this data is: “What if you are already better than your competitors? Does that mean you're doing well enough?”
And usually the leader that sent me after the data, who fully believes that the organization is woefully lagging behind competitors, is not ready for this question. I usually have to ask it twice.
“No, we still need to improve…”
So, while gathering information on another organization's performance can be enlightening, if your goal is to improve, it is not overly useful. If your goal is to be better than your peers, then, of course, this benchmark is essential. Even if your goal is to be better than your competitors, you'll need to know (1) whether your efforts are helping you improve; and (2) how far you are from the performance of your peers (if you're better than your peers, are you done?).
So, if you choose to look only internally at your performance, standards are not necessary. But, if (and when—because eventually you'll want to see how you compare to others) you decide to compare your performance to your peers or competitors, standards will be critical. You can't compare yourself to others when the methods of measurement are different.
Let's say you define the availability of the network as the amount of time without an outage divided by the total amount of time in a given period.
Availability = 1,440 minutes (number of minutes in one day (or 24 hours)) – 20 minutes (of outage) divided by 1,440 minutes
Availability = (1,440 – 20) ÷1,440 = 98.6%
So far, so good. But, let's say your closest competitor (or peer) has a 100 percent availability rate for the same period. Are you going to step up your game a bit? Are you going to work harder? Is your competitor doing better than you?
Well, without standards, you can't tell if your competitor is doing a better job than you. What if you define an outage as any time span that your customers cannot use the network, but your competitors consider an outage as only those times when the network is unavailable due to unscheduled