Improving Organizational Efficiency through the Conduct of a Metrics Case Study

Metrics are measures used by organizations, both business and non-business, to determine whether goals and objectives are being met. This seems a simple matter but it actually is not. At one time or another, there is a need to conduct a metrics case study, especially when companies do not know what to make of their outputs.

Outputs, of course, are predetermined because it is the product of an essential management function and process – planning. And since plans are largely useless without an effective way of measuring its outputs, then metrics cannot be formulated apart from the planning process. The difficulty that many organizations face is how to connect a plan to an output, much less decide whether output is desirable or not. A confusing line of thought, it actually is not. But consider the fact many often plan without considering actual or realistic situations and the result is often confusing. For example your sales, a key performance indicator of your company as it would be in others, is lagging behind expectations and customer satisfaction rating figures are at levels you detest to look at. This is a problem with magnitude that cannot be explained by mere statistics or by jumping into conclusions that the sales force, perhaps they promised too much, is inefficient or the product is unfit for public consumption. It is rather easy to say that but such a treatment of a problem can have grave consequences.

Many experts would go back to the planning process itself and ask whether the metrics are formulated right. And this means not only the metrics involved in sales plans and outputs. It must be remembered that business activities are always interrelated and treating a problem separately from others is a recipe for disaster. The sales force must have, first of all, a good product to sell in order to ensure that customer satisfaction ratings reflect a figure one would be glad to see. This is not guaranteed, as it might just be true that the sales force is actually not that good. But at least, by looking at other potential problem areas, one is not wasting time barking up the wrong tree.

You would like to examine whether product development metrics, another key performance, match the production process metrics or employee development metrics – including that of the sales force, of course. You would like to see whether marketing metrics are reflective of the sales metrics.

All these indicate that in analyzing the efficiency and effectiveness of metrics, the process by which they are formulated must be analyzed as well. The objective of this analysis is to ensure that the related interventions or programs are not only realistically capable of turning in outputs as foreseen but also doable. The metrics of key performance areas must be complementary to form a cohesive whole.

A metrics case study is certainly needed when significant variances in targets vis-0-vis outputs are evident for major key performance areas, such as revenue generation or employee productivity levels. While it is obvious that the correct starting point of analysis is production process metrics, other metrics of operations, like human resources management, might also be involved.