Originally posted at http://www.howtomeasureanything.com, on Monday, December 08, 2008 9:32:43 PM, by Amichai.
“The challenge is to come up with a simple, clearly defined number (or a few numbers) that reflect how well the organization is executing towards the goals from the CEO level to the line worker level. It would also be good to have an insight into what misalignment occurs between departments.
Most importantly, we should be able to track our alignment score overtime and track the impact of our improvements and corrective actions.
Any advice would be greatly appreciated!”
Thanks for your question. I mention strategic alignment just briefly in the book. As with all measurement questions, we start with What do you mean? . In this case, you offered perhaps part of the meaning – how well the organization is executing towards the goals from the CEO level to the line worker level. I would think that the rate it is approaching certain defined goals is itself measurable, especially if the goal is measurable. But perhaps some concrete examples could help us zero in more. Does alignment mean that the activities of each of these levels are contributing to the probability of reaching a goal at a stated time? Does it mean these activities are contributing toward reaching the goal faster? Perhaps the observable object is just the rate of completion of the goal itself. Isn’t alignment just another way to say performance given the way you are using it? If not, what is different?
If you are not just concerned about a % complete measure toward a particular goal then it seems to me that, in effect, you are trying to correlate certain observable input to the probability or rate of completion of stated goals – which, again, sounds a bit like performance. So what you are really trying to measure is whether each of some list of observable activities is improving the rate or probability of completion of a specific goal. Another issue you will have to consider is the tradeoff among multiple possibly competing goals. If you have more than one goal, you will have to collapse these goals into a single value using the utility curve approach I describe in the book or possibly simply monetizing the various goals. This way you can tell if your overall alignment has improved if you have increased satisfaction of one goal but slightly decreased another. Ultimately, it seems like you have a type of forecasting problem. You are asking Based on what I have seen so far (of some list of observations) are we getting closer to or further away from meeting Goal X? The score you are looking for should correlate with rate or probability of goal completion.
In addition to the questions I asked above, here are some more I have for you:
* Is you definition of alignment close to what I just talked about?
* What are some of the goals you are talking about?
* What will be the use of this measure, specifically?
* How much do you know now? What have you seen so far that causes you to think that some departments/individuals are more aligned than others?
If you can answer these questions then I think I can give you some very specific ideas.
Apologies for the long delay in response – your answer is definitely helping with focusing the thought around the issue.
I think the struggle is to evaluate how well our performance at each level of the organization is contributing to the overall performance (and probability of meeting the goals). Are we doing the right things to drive the results? Are we hindering other departments in the process?
To be more specific, let’s assume I’m running the customer service hotline, and two of the overarching business goals is “attract and retain top talent” and “Continuous improvement in quality and efficiency” (these are actual goals). How well is my staff activities aligned with these goals? How does the CEO know if my department is delivering progress on these goals? How can we get visibility to the fact that our invoicing practices cause significant frustration to our customers?
I’m assuming the measure will be used to highlight problem areas and drive some corrective action.
To your last question, I don’t know enough, and from the CEO perspective, there is really no visibility to what the lineployee perceives.
Looking forward to your input!
Good, those are at least more specific. But each can be defined further. Everything you are challenged with, so far, seems to be more of an issue of clarifying what you are trying to do than any real obstacles to measurement.
If you are attracting and retaining top talent you need to figure out how you are determining the level of talent. Are you thinking that hiring policies are attracting people that are more productive and productive sooner than in the past? If you are a service hotline then productivity should be based, in part, on quality and quantity of customer interactions. In my book I describe a method for quantifying how you might be willing to trade these off, as well as how to measure each one. Regarding retaining talented people, of the people who are more productive (if that’s what you mean by talent ), are they staying longer?
On the matter of continuous improvement of quality, I would start with asking how you are measuring quality now. If you can’t measure quality as it is now, you will probably have a hard time measuring whether it improves or if it improves continously. For a customer service hotline, a period sample of quality ratings from customers would be enlightening was your issue addressed to your satisfaction: 0(Not at all) – 5(perfectly). Also tracking customer complaints or even repeat business from customers that had previously called in are good indicators of quality for a customer service desk. Finally, periodic reviews of the recorded calls by supervisors could be an indicator of quality (although for this last one, I would use a blind so that managers are not unfair in their evaluations). If I saw a steady increase in all of these indicators, then it would be safe to say that quality of the hotline is continuously improving. Of course, that is different from the overall quality of your product (perhaps happy customers don’t call the hotline at all).
You said that your CEO knows more about this than you do, but it seems like these are exactly the sorts of things your CEO should articulate. You should not have to try to guess what the CEO means by them. If you have a chance to clarify this further with your CEO, then go back and review each to the questions I had in the previous email. I didn’t see you respond to each and every question I asked so try that as an exercise first. When you get a chance, post your answers to each to those questions. Each one of the questions I asked is critical to solving your problem.
Then, I might start by presenting some of this data visually. Whatever your measure of talent is, show it plotted over time so that increases and decreases will be apparent. Likewise, if you plot average retention (or percentage turnover per year, etc.) over time then you should also see if the pattern is obvious. Finally, if the customer feedback, repeat business from customers that called the hotline, etc. are improving over time (as displayed on a chart) then the connection should be visually obvious.
Is it possible to measure the value of geting information into the hands of someone faster. for example, A customer complaint comes in thte mail. Supoose we digitized the mail and got it to the right person quicker.
Whats the value of that?
Absolutely you can measure that. I think I even briefly mention that issue in the book. Information strikes people as an “intangible” but its value is entirely based on observable changes in behavior brought about by the information.
Think of a different but related question – what is the value of acting sooner? What are the range of likely actions with and without the information and what is the difference? Decompose the problem in a way I describe in the book.
To help you out further, perhaps you could provide some additional details about the context of the problem.
Thanks for your input.
The issue has to do with a proposed implementaion of digital mail.
That is getting critical customer relation type mail ( time sensitive mail ) like complaint or a request for something , in the hands of the right person quickly so they can respond to the problem/ opportunity. By scaning and routing the mail the information arrive quicker than normal company mail delivery.
So the question is , we have to make an investment to enjoy digital mail. One of the benefits is geting the info sooner. But how do you value ” getting it sooner?