Measure to Manage Part III

We continue our series on the advantages of proper business alignment and measurement.

In case you missed the first two parts
Measure to Manage
Measure to Manage Part II

Aligning the efforts of your people to the key objectives you wish to accomplish begins with identifying those indicators.

These main indicators have been called:

  • Key Business Objectives

  • Quality Indicators

  • Key Customer Satisfiers

  • Corporate Dashboard

By whatever name, they represent those major categories that reflect levels of customer satisfaction as determined by the proper functioning of your many sub-systems.

They will vary by industry, but could be:

Customer satisfaction index    On-time deliveries                   Customer complaints

Scrap                                       Warranty claims                      Employee satisfaction index

Share of market                       Re-work                                  Employee recommendations

Billing errors                           Cycle time-responsiveness      Returns

Each of the above represents areas where hard data would indicate how well you are doing through the eyes of your customers, internal and external. Both are very important. It is impossible for your employees to provide excellent customer service if they are not feeling like an important part of the team.

As you look at your organization, what would be the Key Indicators you can measure which would indicate the level of your customers’ satisfaction and your future strength, and that will produce the financial gains that you forecast? In large organizations, these indicators should probably not number more than seven. Smaller organizations would do well to stick to three or four.

What are the key indicators for your organization that reflect the future strength of your organization? You may want to take a few minutes to create a list.

After you have determined your key indicators, assign an “owner.” Each indicator should have an owner at the senior executive level. It will be the owner’s responsibility to make certain that baseline data is established, where you are currently, and then establish improvement goals and action steps for their achievement.

Depending upon the strategy and the specific indicator, cross-functional teams could be established to address and improve each indicator, or functional areas could improve their specific indicators within their area of responsibility. Regardless of the strategy, the owner must be held accountable to the senior executive and the rest of the organization for sustainable continuous improvement.

Next, it would be necessary to include this ownership and improvement into the owner’s job description, performance appraisal, and possibly his/her compensation package. In order to maximize the executive’s strength, it may also be necessary to look at the organizational structure. If the structure is “silo” but your focus is horizontal, there may be a need to possibly structure horizontally, or at the very least set up interdependence by virtue of recognition and compensation. In essence, these issues look at the alignment of the systems in order to gain sustainable results. The goal should be to weave it into the fabric of the organization, thereby making this the “way we do business.”

When you can ask any person in your organization, from the highest executive with the most tenure to the newest hire serving on your front line, “What are the key objectives of this company?” and receive the same answer, you have effectively created alignment. And alignment = success!


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