“The general who wins the battle makes many calculations in his temple before the battle is fought. The general who loses makes but few calculations beforehand.” – Sun Tzu
Business is doing battle every day; most days the battle is within our organizations as we strive to continuously improve capacity and performance. In Mass Destruction, T.J. LeCain explains that the ability to control, manage, and better understand complex systems “demands some means of taking its measure and mapping its essential characteristics.” Measuring and mapping are complementary and co-dependant – mapping creates a model or framework of the systems that then guides measurement efforts. Jerry Harbour, PhD outlines a top-down, model-based approach that begins by constructing a conceptual model or framework of the system and then building measures and metrics into that system. He breaks this method down into 3 steps:
- Determine higher-level strategic performance objectives illustrating desired outcomes.
- Identify a set of key performance elements that represent critical factors that enable desired outcomes.
- Develop measures and associated metric sets for each previously defined key performance elements.
Step one begins with a well-developed strategic performance objective that clearly states what your organization will attempt to accomplish or avoid. It should literally contain an active verb, subject matter, and related performance goal. For example, one mining company states their objective is to “extract, crush, screen, and ship iron ore to overseas steel mills in an environmentally sustainable manner, while achieving a competitive rate of return.” This objective clearly states what the organization strives to accomplish, and defines the desired outcomes of sustainability and profitability.
Without such clear performance objectives, how will your organization achieve them? Can you and your employees clearly articulate what you are aiming to accomplish? If not, then how can you measure success? We will continue next time with identifying key performance elements. Check in with a few of your employees, ask them what your performance objectives are. We hope you will be pleasantly surprised, but if not, give us a call and we’ll be glad to help.