Measure what Matters

According to Michael Henderson, Corporate Anthropologist on Oscar Trimboli’s Deep Listening Podcast, people in the western world like threes because we like balance.

We like Low, Medium and High. We like the Three Little Pigs and Goldilocks and the Three Bears.

We also like it when a salesperson stops at three when telling us about the wonders of their product. Trust and desire builds to three and starts to wane above three. As in, “Why does she need to keep listing stuff? Is there something not great about this product?”

And when it comes to decision making, we like to discuss it in terms of past, present and future – What, So What, Now What.

Recently I was asked, along with my colleague Dr Andrew Pratley who specialises in making meaning of data, by a client to help them revisit their KPIs. The challenge we were set by the CEO was to come up with three KPIs that will drive optimal decision making. That is, the three measures the organisation can turn to when considering significant decisions.

As the project progressed we recognised that three KPIs were excellent for focussing on the business’s performance.  However, due to the complexity of the organisation, to achieve the goal of better decision making, we needed something more in depth to drive optimal decision making.

KPIs alone are fraught with danger because the decisions of one department in an organisation, focused on a particular KPI, will often make decisions detrimental to other departments.

What was actually needed was a decision framework. A methodology for driving decisions in departments, by the executive and by the board that were in the best interests of the organisation as a whole. And that meant determining at the department level what needed to be measured to ensure progress towards the high level KPIs we devised.

In the words of a senior member of staff, this is not what we thought we would get, however, it is far more useful.

So while KPIs matter, what matters more is measuring the individual drivers of decisions at the departmental, executive and board level.