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Showing content with the highest reputation on 07/15/2019 in Posts

  1. Secondary Metric: in a project is one that has to be kept constant or prevented from deterioration as it is an important process metric even though it is not the metric to be improved. (taking the definition from Forum's dictionary) Almost 99.9% of the projects will have one or more secondary metrics. One could imagine the secondary metric as a contradiction or a constraint while improving the primary metric. Providing some examples below 1. Formula 1 race or any other race: Primary Metric is the speed. You want your vehicle to go as fast as possible. However, there are a few constraints (or secondary metrics) in achieving speed greater than a certain value. Listing some of them below a. The downforce has to be high at higher speeds. This is because at high speed, the vehicle will have a tendency to leave the ground and this is undesirable. and If downforce is kept high then higher speeds are difficult to achieve. Hence, a goal would be to maximize the speed of the vehicle without increasing the downforce b. Revolutions (or revs) of the engine. Higher speeds requires an engine to rev at higher speeds i.e. more revolutions per minute. However, higher revs would mean higher fuel consumption. Hence, a goal would be to improve the speed without increasing the revs Similarly there are a host of other secondary metrics when we look at the design of a formula 1 car and the objective is to make it go as fast as possible. 2. Looking at the way India is playing in this semi-final, Primary Metric is to improve the run rate while ensuring that risk of shots played does not increase Risk of the shots played is the secondary metric here Other common examples 3. Lower Average Handling Time should not compromise the First Call resolution 4. Higher Return on Investment while keeping the Risk constant 5. Hiring the best available talent while keeping the cost constant How do we identify the secondary metrics? a. Mostly it is intuitive and if you are well aware of the process, one can easily identify the list of secondary metrics for a particular primary metric. b. One could identify the secondary metrics if one thinks about the constraints or contradictions c. Look at the Roof of the House of Quality (correlation matrix between the technical specs) Situations where there is no Secondary Metric Ideally there will always be one or more secondary metric (I wrote 99.9% above). The only 0.1% situations where I think secondary metric will not make sense are matters of life and death. In other words, these are situations where focusing on secondary metric is of no relevance. Some examples below 1. In medical world, steroids are considered as life saving drugs. However, it is well established that these steroids have side effects as well. Now, if a person is on a death bed (sorry for such an extreme example) and a steroid can save their life, then the side effects really does not matter. Another e.g. from the recent Jet airways. Primary metric was to remain operational. Even though this came at a very high cost (secondary metric) but Jet was not worried about cost because the survival of the organization was at stake (this was obviously before they were completely grounded). 2. If the primary metric is about adherence to regulatory or compliance issues. In such situations, the focus on secondary metric is not at all important. E.g. Indian automobile manufacturers have been advised to be BS 6 compliant. Now this is the primary metric. Due to this the cost of cars (secondary metric) is getting higher, but the manufacturers are not worried about the cost as it is a regulatory requirement. Similarly, the reserves that a bank has to keep is a regulatory requirement from RBI. The secondary metric is the cost of parking funds. But banks do not focus on cost of parking funds in order to maintain the reserves. To conclude, Secondary metrics will always be present. Only in special circumstances, one could choose to ignore the secondary metric since primary metric is too critical and the improvement in Primary metric offsets the degradation in the secondary metric.
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