A Professional's Guide to Decision Science and Problem Solving: Define the Objectives and Identify Metrics
- 1.1 Chapter Topic
- 1.2 Key Corporate Participants
- 1.3 Management Steps Required to Execute the Approach
- 1.4 Solving the Right Problem
- 1.5 Developing an Understanding of the Problem
- 1.6 Defining Goals and Objectives of a Company or Organization
- 1.7 Defining the Framework for the Decisions Being Made
- 1.8 Metrics for Measuring Success
- 1.9 Definition of a Metric
- 1.10 Developing Decision Criteria and Metrics
- 1.11 Data Used to Support Metrics
- 1.12 Structure and Definition of the Problem
- 1.13 Key Concepts in Defining the Objectives
1.8 Metrics for Measuring Success
When an organization has defined and agreed upon its goals and objectives, decision makers should then develop a means to track and measure the accomplishment of these objectives. Often within an organization, a strategic plan, short-range plan, or long-range plan is developed and published as an edict to the organization. These plans may, however, end up on a shelf with no real meaning in the day-to-day operation of the organization. To drive these goals into the operating decision levels within the organization, these goals and objectives must be translated to meaningful measures of success that are used within the decision process and tracked within the organization. This is key to ensuring that the organizational goals are met. In the last section you saw how to integrate these organizational goals and weight their importance for all to follow. You now need to track their success.
Because so much data is currently available, you need to determine those measures (metrics) that provide a meaningful measure in achieving success within the organization. This process involves identifying criteria that are important to the organization. Typically decisions are made based on one or two criteria, so the metrics to support the decision process should be kept to a minimum. An approach is described in this chapter for identifying decision criteria and determining their overall importance in the decision process and measuring their success.
Based on identifying the important criteria, then data sources are assessed to determine whether this information can be relatively easily obtained, processed, and maintained. Data should be assessed to determine what level of detail should be maintained for it to be used as a metric to measure success. It may be tracked, for example, on a plant-by-plant basis or rolled up across the organization as a whole. Data can come from both automated sources or from assessments made by experienced executives or experts in the field. The process to establish, track, and maintain metrics and measures of success for an organization provides meaningful information in achieving success and understanding the organization's operations at every level.