Which metrics are used to measure effectiveness, efficiency, and adaptability?
- You have values and goals. You have some metrics in place. You probably developed a few metrics to ensure all of the values and goals were being supported. Alignment is within reach. Now the question is: does the company have metrics to support all three of the main categories of measurement? Effectiveness, efficiency, and adaptability. So look at your list. My guess is you have quite a few metrics that measure effectiveness.
You might even have a few that measure efficiency, and if you're like lots of other companies, you're probably a bit thin in adaptability measurement. Let's take a moment to look at some very simple examples of metrics in all three categories. In basketball, we measure effectiveness with points scored. Efficiency, we measure with minutes played and shots taken, and for adaptability, we can measure how the player did in home games versus road games, how the player did versus left-handed players or right-handed players.
For a student in school, effectiveness is measured with grade point average. Efficiency, the number of courses taken, the number of hours a student studies. And for adaptability, we might break up the grades in terms of math classes, science classes, and writing classes. And how about for an operator in a call center? Well maybe we measure effectiveness with the number of orders taken.
Efficiency, the number of hours they worked, and for adaptability, we might look at monthly numbers. Numbers for morning shifts versus evening shifts. It's also possible you have a few metrics that are ratios of two categories. For example, points per minute, revenue per month. One other thing I'd like you to consider is balance. The number of metrics being tracked can grow really fast.
Especially when you try to account for so many goals, and you also try and measure in all three categories of measurement. While getting a nice three-dimensional view of the company through our metrics is important, too many metrics in one category of measurement can easily make things look much better or much worse than they actually are. For example, suppose we have eight effectiveness metrics but only two efficiency metrics.
It's possible our employee could excel in effectiveness, but they might be incredibly poor in the area of efficiency. You might be smart enough to see the difference in the metrics. You would say, "Great in effectiveness, "but struggling in efficiency." But to other managers, they might say, "This employee is great. "They're positive in eight areas, "and only struggling in two metrics." Unbalanced metrics can be misleading, so let's recap.
Check for alignment between goals and metrics. Make sure each goal is supported. Be sure each goal is also measured in effectiveness, efficiency, and adaptability, and finally, try creating a balance system. One that won't mislead your managers, or your employees.
- Metrics and human behavior
- Common corporate errors in measuring
- Developing a good metric
- Using the performance measurement tune-up
- Avoiding redundancy
- Using dashboards, infographics, and other data visualization tools