Most organizations are choking on performance data and have little understanding of what data are important (need to know) and what data are merely interesting (nice to know).
Many companies find it relatively easy to add new metrics to scorecards and dashboards, but few are good at weeding out metrics that are no longer relevant. The result is a bloated scorecard with more data points than anyone can possibly manage or absorb. When setting up metrics, the key factor is the team’s mental bandwidth. How many performance metrics can anyone simultaneously support? The answer: Fewer is better. Having fewer metrics creates sharper focus and more considered effort.
A sales team may not have a clear path to control defect rates. A production team may not have a clear path to improve product awareness. When designing a work team’s scorecard, ask what behavior change each metric can influence. If the answer is unclear to you, it won’t be clear to the work team.
Author: Jay Freeman
Source: Gallup Management Journal
Subjects: Management, Measurement