Measure  What  Ma+ers  Steve  Stanton,  Managing  Director  

Webinar    August  26,  2015  

For  more  informa8on,  go  to  fcbpartners.com  or  call  Lindsay  Field  617.245.0265  

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One  Underlying  Issue  

“We  measure  far  too  much  and  get  far  too  li9le  for  what  we  measure  because  we  never  

ar<culated  what  we  need  to  get  be9er  at  and  our  measures  aren’t  <ed  together  to  support  higher-­‐

level  business  goals.”  

We  measure  the  visible,  the  easy,  the  familiar,  and  the  intui8ve,  rather  than  the  important  

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Why  Is  Process  Measurement  so  Difficult?  

Requires  Deep  Insight  

how  this  process  creates  value  what  this  process’s  customers  really  want  how  this  process  serves  the  organiza8on’s  strategy  how  this  process  connects  with  other  processes  intui8on  and  history  are  no  longer  enough    In  Addi8on  the  environmental  trifecta  of  complexity,  novelty,  and  speed  digi8za8on  provides  even  more  opportuni8es  we’re  now  entering  the  age  of  data-­‐driven  decision  making  

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Principles  of  Process  Measurement    

The  primary  goal  of  measurement  is  not  to  measure,  but  to  improve  business  performance  

Measurement  must  be  driven  by  an  understanding  of  causality  and  focused  on  what  you  can  control  

Processes  are  where  strategy  becomes  opera8onal  

Measure  as  liQle  as  possible  and  pilot  metrics  before  ins8tu8onalizing  

Metrics  are  how  importance  is  communicated  

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A  Quote  to  Remember  

“If  results  aren’t  improving,  then  you  must  be  measuring  the  wrong  things.”  

 

In  the  footsteps  of  W.L  Bateman  

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Measurement  Language  

The  Process  Scorecard  defini8on  –  the  few  vital  measures  needed  to  assess  performance,  progress,  and  opportuni8es  for  improvement    Key  Terms  lagging  indicators  that  tell  you  where  you’ve  been,  generally  outcome  metrics  used  for  repor8ng  

leading  indicators  that  tell  you  where  you  may  be  going,  generally  in-­‐process  metrics  that  illuminate  improvement  opportuni8es  

key  metric  –  the  performance  aspect  worthy  of  measurement  

baseline  –  current  performance  

target  –  desired  performance  

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The  Process  Scorecard  

Roughly  7  key  measures  (plus/minus  2)  plus  or  minus  2  requires  serious  discipline  

Mix  of  leading  and  lagging  err  on  the  side  of  leading  

One  or  two  per  cri8cal  stakeholder  and  manage  tradeoffs  

Updated  frequently  and  communicated  oSen  

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APA Scorecard DPS PC Scorecard Page 3 Region NReg Zone Nor-E Site Durham Name Vaughn Report Period Mar99

Current Actual Current Perf Current Performance Req'd for S2 Rating Yearend Performance Required for

S1 S2 S3 S4 Customer Service

%Customer Svc Orders On-time Site 98% 95% 4 94% 95% 97% 98% %Repeat Customer Service Work Site 10% 16% 3 18% 16% 12% 10%

Reliability & Integrity %SMEI Inspect Comp vs Plan Region 110% 93% 4 90% 93% 97% 100%

Business Expansion

Cost Routine Outages $/outage Region 277 226 0 232 226 212 206

Customer Premise $/Order Region 57.58 31.21 0 31.82 31.21 29.99 28.76

Bus Expansion $/Cust Add Region 1,769

1,975 4 2,033 1,975 1,897 1,839

Workforce Effectiveness Lost & Restricted Work Days Region - 56 4 300 225 175 100

SUMMARY - CURRENT SCORECARD PERFORMANCE 2.7

The Scorecard

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Hil8’s  Measurement  System  Began  with  a  set  of  strategic  business  objec8ves  derived  from  the  corporate  strategic  plan  

Iden8fied  11  enterprise  KPI’s  related  to  strategic  objec8ves  customer  sa8sfac8on,  profit  per  employee,  perfect  orders,  repair  cycle  8me,  etc.  some  process-­‐specific,  some  cross-­‐process  

Translated  these  into  60  performance  drivers  drivers  of  KPI’s  or  more  detailed  outcomes  all  associated  with  specific  processes  e.g.,  complaint  solu8on  finding  8me,  complaint  solu8on  execu8on  8me,  open  complaints,  number  of  orders  per  customer,  etc.  

Managing  process  around  these  drivers  cockpits,  design,  rewards  

                                                         Source:    Hil<  

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Summary:    CSF’s  of  Process  Metrics  Focus  on  end-­‐to-­‐end  outcomes  and  performance  transcending  boundaries  

Rigorously  derive  from  customer  needs  and  enterprise  goals  via  causal  model  

Encompass  mul8-­‐dimensional  performance  goals  the  world  is  not  a  simple  place  

Avoid  being  distracted  by  sub-­‐measures  the  case  of  the  airline  pilot  

Create  universal  understanding  and  awareness  to  focus  people’s  aQen8on  

Align  rewards  with  metrics  to  reinforce  them  

Use  to  monitor  performance,  shape  behavior,  and  drive  change  making  abstrac8ons  concrete  

             

             

           

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FCB  Fall  2015  Courses  

Event   Descrip8on  

Process  Redesign   Hammer  Cer<fica<on  Course  Boston,  MA  September  15-­‐18  

Reengineering  Innova8on   Advanced  Cer<fica<on  Course  Boston,  MA  September  16-­‐18  

Process  Owners  in  Ac8on   Advanced  Cer<fica<on  Course  Boston,  September  16-­‐18  

Power  of  Process   Hammer  Cer<fica<on  Course  Boston,  MA  November  16-­‐17  

Leading  Transforma8on   Hammer  Cer<fica<on  Course  Boston,  MA  November  18-­‐20  

Measurement  Excellence   Master  Class  Boston,  MA  November  18  

For  more  informa8on  go  to  fcbpartners.com  or  call    Lindsay  Field  617.245.0265  

11  ©2015  FCB  Partners.  All  rights  reserved.  

For  More  Informa8on  FCB  Partners  

 Lindsay  Field,  Program  Director  

617  245  0265  lfield@fcbpartners.com