AGoodp Metric satisfies 3 Broad criteria 1. Strategic 2. Quantitative 3. Qualitative
6 A “Good” Metric Satisfies 3 Broad Criteria A “Good” Metric Satisfies 3 Broad Criteria 1. Strategic 2. Quantitative 3. Qualitative Debbie Nightingale, MIT © 2001
Strategic A good metric should Enable strategic planning and then drive deployment of the actions required to achieve strategic objectives Ensure alignment of behavior and initiatives with strategic objectives o Focus the organization on its priorities Example: How fast do we need to develop and market new products to grow 20 percent per year?
7 Strategic Strategic A good metric should: z Enable strategic planning and then drive deployment of the actions required to achieve strategic objectives z Ensure alignment of behavior and initiatives with strategic objectives z Focus the organization on its priorities Example: How fast do we need to develop and market new products to grow 20 percent per year? Example: How fast do we need to develop and market new products to grow 20 percent per year? Debbie Nightingale, MIT © 2001
Quantification of Metrics is Critical When you can measure what you are speaking about, and express it in numbers, you know something about it; but when you cannot measure it, when you cannot express it in numbers, your knowledge is of a meager and unsatisfactory kind Lord Kelvin
8 Quantification of Metrics is Critical Quantification of Metrics is Critical “When you can measure what you are speaking about, and express it in numbers, you know something about it; but when you cannot measure it, when you cannot express it in numbers, your knowledge is of a meager and unsatisfactory kind.” - Lord Kelvin Debbie Nightingale, MIT © 2001
Quantitative A good metric should Provide a clear understanding of progress toward strategic objectives o Provide current status, rate of improvement, and probability of achievement o Identify performance gaps and improvement opportunities Example: What is the cycle time of our product development process? Where does the process need improving the most? Debbie Nightingale, MIT @2001
9 Quantitative Quantitative A good metric should: z Provide a clear understanding of progress toward strategic objectives z Provide current status, rate of improvement, and probability of achievement z Identify performance gaps and improvement opportunities Example: What is the cycle time of our product development process? Where does the process need improving the most? Example: What is the cycle time of our product development process? Where does the process need improving the most? Debbie Nightingale, MIT © 2001
Qualitative A good metric should Be perceived as valuable by your organization and the people involved with the metric Example: Is the effort and cost of collecting the data reasonable? Is the information timely and actionable? Debbie nightingale, MIT O 2001 10
10 Qualitative Qualitative A good metric should: z Be perceived as valuable by your organization and the people involved with the metric Example: Is the effort and cost of collecting the data reasonable? Is the information timely and actionable? Example: Is the effort and cost of collecting the data reasonable? Is the information timely and actionable? Debbie Nightingale, MIT © 2001