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The Institute Way Blog

Tuesday, September 5, 2017

How Do You Measure The Impact Of An Initiative?

By: Stacey Barr

Let’s get right to the point: if you have to ask how to measure the impact of an initiative, it means you got things back to front.

Asking “how do you measure the impact of an initiative” means you don’t already know what the measure is. Obviously. But it can also mean you don’t even know what the impact should be.

And that means you chose the initiative before you fully understood what you needed it for. Stay on this path, and you’ll end up wasting a lot of time, money, and angst.

What was the goal that needed the initiative?

Sure, you might have had a goal the initiative related to. But it was likely a vague goal. If it had been a clear goal, it would have been very easy to also find a good measure for. And in that case, the impact of any initiative you chose for the goal would be measured by the measure of the goal.

Say, for example, your goal was to “Reduce the amount of time employees spend doing rework”. You might even go a step further and define rework as time spent changing or re-doing something that wasn’t done right the first time. Then it’s super easy to see this could be meaningfully measured by something like the percentage of employee work hours that are spent on rework.

And, continuing the example, the impact of any initiative to reduce rework would be measured by the percentage of employee work hours that are spent on rework. The impact would be the difference in this measure before and after the initiative was implemented.

Measures come before initiatives.

If you don’t know how to measure the impact of your initiative, you’ve chosen the initiative way too soon.
You’ve set the initiative out of logical order. But it’s common to do such things, and you’ll see it happening in many planning processes. It goes something like this:

1.    Set a goal [usually weasely and immeasurable]

2.    Pick an initiative to achieve the goal [without first thinking about the cause or leverage]

3.    Set a target [usually something meaningless like ‘10% improvement’]

4.    Choose a measure [as an afterthought, many weeks later, sometimes even after the initiative has been implemented]

There is a more logical order to approach planning, so that initiatives fit in sensibly and make the right impact (more detail here):

1.    Set a goal and make it easy to understand and measurable

2.    Design a meaningful measure as evidence of how much the goal is happening

3.    Set a sensible target for the measure to express how much improvement will mean the goal is achieved

4.    Analyze the business process that most impacts on the measure and find out the biggest cause that stops it performing at the target level

5.    Set an initiative that will mitigate this cause

6.    Implement the initiative in a way that isolates its impact.

Setting initiatives isn’t about jumping through planning process hoops. It isn’t about justifying our pet projects. It’s about spending resources as wisely as possible to reach specific goals.

We might need to practice non-attachment.

Following the second process, above, for aligning initiatives to measures and goals can often reveal that some initiatives are irrelevant or lame and will waste lots of time and money. And even if it stings our egos a little bit, it’s better to know that now, before all that time and money and angst goes to waste. And makes no difference that matters.

If you don’t know how to measure an initiative, you chose the initiative too soon.
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Stacey Barr is a specialist in organisational performance measurement and creator of PuMP, the refreshingly practical, step-by-step performance measurement methodology designed to overcome people’s biggest struggles with KPIs and measures. Learn about the bad habits that cause these struggles, and how to stop them, by taking Stacey’s free online course “The 10 Secrets to KPI Success” at www.staceybarr.com/the10secretstokpisuccess.
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Author: Stacey Barr
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Tags: performance management KPI / performance measurement

Stacey Barr

Stacey BarrStacey Barr

Stacey Barr is a specialist in organizational performance measurement and creator of PuMP, the refreshingly practical, step-by-step performance measurement methodology designed to overcome people’s biggest struggles with KPIs and measures.

Other posts by Stacey Barr

Contact author Full biography

Full biography

Stacey Barr is a specialist in organizational performance measurement and creator of PuMP, the refreshingly practical, step-by-step performance measurement methodology designed to overcome people’s biggest struggles with KPIs and measures. Since the mid 1990′s Stacey has been developing and improving this methodology into the practical approach that thousands of people around the world are using today. Her long-term vision is that deliberate performance measurement, based on a methodology like PuMP, is as much a part of normal business management as financial management is.

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