In the book, Bare Bones Change Management: What you shouldn’t not do, Bob Lewis explained the seven must-have elements for any change management effort to have a chance of succeeding. Here are my takeaways from one of the topics discussed in the book.
What are the differences between performance metrics and service levels? Each has its purpose and use case.
Performance metrics tell us how we are doing, generally in statistical terms such as mean, standard deviation, and other measurements. With performance measures, we can apply on-going continual improvement activities.
Service level metrics tell us when failing to achieve some level of performance; something will cause problems. Unlike performance metrics, an additional improvement on the already-met service level metric will not result in business benefit.
When constructing a metric plan, Bob suggested to include the following components:
Component #1: Business improvement goals. This component describes the bottom-line benefit the organization plans to achieve, the business outcomes that will make the bottom-line benefit happen, and the internal improvements to effectiveness that will drive the business outcomes.
Component #2: Business improvement metrics. This component includes metrics for the planned improvements to internal effectiveness. The metrics typically include the six major categories: fixed costs, incremental costs, cycle time, throughput, quality, and excellence. It also includes our decision as to whether to use performance metrics or service level metrics.
Component #3: Targets. If the business case calls for it, we might want to go beyond defining metrics and establish improvement targets. Targets can help the organization realize, once the change has been put in place, a clear statement of how much improvement is good enough.
Component #4: Reporting system. This component describes how we build data collection into the process flow, build the means for using the collected data to support the project work, and develop communication mechanism.
Component #5: Metrics parsimony. This component describes the tactics we can use to ensure the metrics fulfill the qualities of being: connected, consistent, calibrated, complete, communicated and current.