Measure what we act, act on what we measure?

In a recent article about Analytics, Marketing Guru Seth Godin wrote an interesting take on what NOT to measure, stating it does not make sense to measure something you’d not be willing to act upon.

That made me pauze, and think a bit.

I fear that, if we consistently applied this rule, there would be little left to measure. Is this because we are all unwilling to act?

There are of course many things on which you could not act upon even if we’d be willing to. Things like margin, gross profit, cost, DSO are not as easily tied in into effective actions. Customer Satisfaction, Employee Engagement and Shareholder Value sound great, but are not easy to improve. Don’t get me wrong, we should seek improvement, and in order to achieve improvement, we need to be able to measure effectiveness, efficiency and their relation to bottom line performance, cost and result.

Having been involved in so many management/measurement efforts, I have found that, when asked how to improve and what to measure, people tend to easily think about other people.

Ask the marketeer on what would make him more efficient – he will likely talk about getting better input from the sales force to enable him to better target the market.

Ask the sales manager what would be needed – she will likely have better qualified leads from the marketing department high on the priority list.

Ask finance and they will talk about customers paying on time, and vendors offering more flexibility. Ask the COO and they might say: a better alignment of the Human Resources strategy to operational needs. When talking to the HR staff, they may like to get a better system from IT. Ask IT and they would like to get a bigger budget.

When seeking improvement, is it so hard to look to ourselves?

When we determine what to measure – are we not able to be self-critical?

It is easy for management to start measuring the unmanageable, and it can be tempting to set up KPI’s which make sure others are meeting responsibilities we impose.

But what if we only measure things people are unwilling (or unable) to act upon?

Would we not be better off, not measuring at all?

See other article on measuring what matters.