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Q3. Dashboard, Numbers, Metrics, CTQs, are commonly used terms in the domain of Business Excellence. Here are conflicting views by two Management Gurus - 

 

Quote

"If you can't measure it, you can't manage it" - Peter Drucker. 

 

Quote

"It is wrong to suppose that if you can't measure it, you can't manage it. The most important numbers are unknown and unknowable" - Dr. W. Edward Deming

 

 

What is your view on this? Is measurement essential for good management? Why? Why Not?

What did Edward W Deming mean by his statement? 

 

You may like to carry out research over the internet, talk to your partner, and colleagues while framing your response. Each club may submit maximum two responses, one by each member. Please write the answer in your own words. Please do not copy and present someone else's explanation as your own. As Excellence Enthusiasts, we are against plagiarism. 

 

Remember - Your answer will not show when you submit. It will be made visible only at 4 PM tomorrow. May the best answer win. All the best! 

 

Cheers to the Spirit of Excellence! 

 

This is the Excellence Ambassador Episode 1 - Only registered and approved club members will be able to respond to questions between 4th September and 29th September 2017. One daily question is announced at 4 PM on each working day and will be closed for responses at 4 PM on the next working day. Once responses are locked at 4 PM on next day, they will be made visible to everyone. Each Excellence Ambassador (and other readers) will be asked to vote on the answers of the day by upvoting or downvoting. The voting will close at 6:30 PM and best response will be selected out of ranked responses at 7 PM. One response will be marked as the best answer and will remain on our forum as a reference for future visitors. Together, the Excellence Ambassadors will build the best Business Excellence Glossary.

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We should not see two statements as mutually exclusive statements. Both of them are correct in different contexts.

 

We need to measure things to manage them effectively. Especially we need measurements for trends, analysis and performance reporting. (Peter Drucker)

 

However, if any business rely exclusively on their performance metrics and assume everything hunky dory some surprises are bound to happen.

 

Let us consider an operations where the SLAs are always Green. If the operations head assume that the customer is super happy with the service and do a CSAT- it may throw some surprises. This we call it as watermelon effect. Where SLAs are Green and the CSAT is Red.

 

The other example can be a product sales exceeding the targets for several quarters. If the business assumes too much of customer loyalty towards that product and doesn’t innovate enough- they are in for surprise when one fine day a better product enters the market.

 

What we cannot measure in the above examples (and which is important for a Business) is  Human behaviors, Relationships, Customer Requirements and Expectations. (Deming)

 

So we should have good measurements in place to manage the Known- Knowns. At the same time we need to cognizant of the fact that some unknowns/unstated needs exist in the business which we have to manage even without Metrics.

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Every act needs a start and an end point. Its needs resolution and frequency to determine the distance. It needs compliance and compliment to establish the depth. The conformance to the goal is possible when both quantity and quality are raised to a better value than the current value.

For the aforesaid philosophy, measurements are imperative.

 

"If you can't measure it, you can't manage it" – This thought/ belief drives the requirement of a measuring system for every undertaking involving systems. The performance of any process will be analyzed based on the numbers set to achieve. Learning is not possible if the measurements are not in place. Vision gets blurred as the focal length is not adjusted with regards to the momentum towards the goal.

 

"It is wrong to suppose that if you can't measure it, you can't manage it. The most important numbers are unknown and unknowable" - Well, this belief is a warning that you should not have a predefined set of measurement as it leads the thinking/drive for excellence confined to the boundaries of those numbers. Unexplored are the treasures for new beginnings, opportunities, growth, potentials and learning. When we talk about the concentric circles of Control, Influence and Concern, Unknown area will be ventured only by expanding the circle of influence. Hence by being effectively predictive and strongly proactive one can achieve the unimaginable.

 

Continuous improvement of processes and questioning status quo are the solution areas  that will help these gentlemen settle their differences.

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In my view both the statements have their own place in the continuous improvement or excellence journey.

 

 

"If you can't measure it, you can't manage it" - Peter Drucker. 

"It is wrong to suppose that if you can't measure it, you can't manage it. The most important numbers are unknown and unknowable" - Dr. W. Edward Deming

Arguments For

  • Measuring is a definite way of identifying whats working and what is not working. If something can be measured, then definitely it is easier to manage and manage effectively.
  • Managing things that can be measured without measuring definitely hurts chances of success or extent of success.
  • Eg. Losing Weight without stepping on weighing scale regularly
  • Measuring everything of importance to management is not feasible however it must still be managed – otherwise these           important aspects that cannot be measured are left unattended
  • To put it in another way, we just cannot say what can’t be measured it not worth managing.
  • Eg. ROI on raising children, satisfaction of serving society,       reputation, creativity, relationships

Arguments Against

  • Focusing on numbers without proper understanding of concepts of variance and other statistical interpretations or using inappropriate measures can lead to inappropriate conclusions.
  • For eg. measuring success of an event by no. of participants who attended alone – may or may not mean anything.
  • You can’t know whether you are successful unless success is defined. It helps demonstrate progress and qualify success.
  • For eg. employee satisfaction cannot be measured using a           specific index or parameter however in absence of defining some way to measure it you may meet challenges.

 

After detailed investigations, it appears that both gentlemen had strong measurements background and have faith in measurements systems and its importance, they however feel that not everything important can be measured.  

 

Some references - 

http://www.druckerinstitute.com/2013/07/measurement-myopia/ 

https://blog.deming.org/2015/08/myth-if-you-cant-measure-it-you-cant-manage-it/

 

Conclusion: Measurement YES, but ONLY measurement NO. 


 

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"If you can't measure it, you can't manage it" - Peter Drucker.   "It is wrong to suppose that if you can't measure it, you can't manage it. The most important numbers are unknown and unknowable" - Dr. W. Edward Deming 
Measurement is critical & necessary for the success of business as through it useful information about the performance of products, processes and services are received. Measurement of any process,product or service, when mapped against the set standard, provides opportunities for continuous monitoring, control, management and  improvement towards meeting key customer specifications, hence towards business excellence and success.

Measurement helps in identification, tracking and fixing of deviations through corrective actions real time or at an defined interval thus removing any room for guesswork.
Deming was a very strong proponent of data driven approach for business solutions. He is best known for the Plan Do Check Act ( PDCA ) cycle.

However, through the quote,
"It is wrong to suppose that if you can't measure it, you can't manage it. The most important numbers are unknown and unknowable"
, he is emphasizing the business impact of any special & unseen cause, natural calamities, advancement in technology. Such impacts cannot be outrightly measured but can have massive impact upon the sustenance and continuation of any business.

Such unseen , special or any futuristic cause can at best be visualized and managed through personal ingenuity and discernment. Merely relying on data and measurement for such will reign havoc and destruction for the business.

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What is your view on this? Is measurement essential for good management? Why? Why Not?

What did Edward W Deming mean by his statement? 

 

 

I personally feel , “if you cannot measure it, you cannot control/ Manage it” holds now , more than ever before. I am saying so as techniques to collect data and techniques to measure most processes through statistic and other experimental methods has evolved manifolds over time. Due to this, It is easier to manage processes and bring about enhancements and control it through the analysis of available data. We have become dependent on data to manage processes and bring about desired results – better than the current measured process matrices which can be attributed as “benchmarks”

Having said that , I feel that the concept of measurement cannot be always limited to a sheet with notable calculations / formulae derived from data and definite yields from them.

I am sure one would agree that millions of years of evolution has given us humans a built in information processing tool that takes signals from the environment and enables us to form decisions, so there’s “Neuro signalling data processor” buried somewhere in our heads.

When one sees anything that has room for improvement, i.e. there is something in it, which is not quite right or satisfactory. That “something” itself is the “data” or data related.

Thus, data in it's wide spectrum covers the information one does not necessarily have to measure physically or literally put on paper.

The "Fact"is data. One observesmeasures it against a reference / benchmark / level of satisfaction > Analyze it > work out a resolution/action = Decision which leads to improvement followed by control.
“All done in your head”. It is a natural inbuilt flow

It is understandable that ability to measure is not the only thing that’s important in and of itself. It’s also critical to understand the effect of measuring, and whether you are able to measure a system effectively and constructively.

 

As I was researching on the net on the quote by Dr. Edward W Demings, There seems to be an ambiguity –

John Hunter states in the W.Edwards Intitute Blog that the actual quote was-

It is wrong to suppose that if you can’t measure it, you can’t manage it – a costly myth.

His quote is saying the opposite of what most people think it means when they use the quote without the extra words he used. This is one of the dangers in using quotes without context.

 

According to Hunter, Dr. Deming did very much believe in the value of using data to help improve the management of the organization,And several of the tools he recommended involved using data (Plan- Do- Study- Act Improvement Cycle, Control Charts) 

But he also knew that it wasn’t close to enough. There are many things that cannot be measured and still must be managed, And there are many things that cannot be measured and managers must still make decisions about, Hence; he is also quoted as saying The most important numbers are unknown and unknowable" 

He probably was putting across  that using data to aid in improvement efforts is extremely valuable. However, it is easy to be led astray while focusing on numbers without a solid understanding of concepts such as: variation, appreciation for a system, the proxy nature of data, theory of knowledge, etc..

 

Another, example that hits through and supports the above mentioned thought is, due to the time lapse in results you can’t measure the productivity of a team until a few years after a release of the software they were building. By teh time you put in the effort to measure the impact, the technology would have changed/ evolved and the software could be close to redundancy. But, the decision of building the software were probably taken, considering the need of the moment, based on factual requirements. 

As I have mentioned herein above, even that instance of taking a decision on facts that are observed is an intricate process of measuring and analyzing data within our head. It is overall a “measured” effort to bring about a desirable change , hence I strongly believe that the quote "If you can't measure it, you can't manage it" is valid at all time and covers it all, anytime...... every time!!

 

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Peter Drucker

"    If you can't measure it, you can't manage it"
1. You have a meeting tomorrow.

2. You have a meeting tomorrow at 3:00 PM at ABC Company located at XYZ location.

Looking at above two statements, one will feel more comfortable to attend the meeting based on statement no.2.

 

What peter Drucket meant was same thing, you can’t know whether you are heading the right path unless you have target. That target should be tracked and measured at regular intervals for gap analysis. Without firm objectives/target you are always reliant on your gut feeling .

Measuring data helps in making decision with confidence.

It helps in continual improvement, setting new targets each time.

 

        Dr. W. Edward Deming

        1. “It is wrong to suppose that if you can't measure it, you can't manage it. The most important numbers are unknown and unknowable” - Dr. W. Edward Deming

       Before I discuss about this quote, let us see another quote from Dr W.Edward Deming.

      2. “In God we trust; all others bring data.”

    Both these quotes are from Dr. Deming. And it looks like both are contradictory.

   It is very important to know in what context Dr Deming quoted “It is wrong to suppose that if you can't measure it, you can't manage it.  The most important numbers are unknown and unknowable” - Dr. W. Edward Deming

There are certain things in industries that cannot be measured, all those tangible things like

  1. Companies brand value
  2. What benefits you will get if an employee goes for training
  3. How much savings can be done if we implement 5S at our workplace
  4. Benefits of a visual management process
  5. How much did a customer like your product?
  6. Benefits of letting employees play games/ have a nap during their lunch hour
  7. Qualitative experience of an employee.

Dr. Deming was never against gathering data and making improvements based on that data.

Though we don’t know how to measure some things, a Manager has to manage those activities also.

Managers can measure factors affecting that thing. If that factor was not impacting we can always change our metrics and measure something else that gives proper reflection.

For small improvements, it is not advisable to waste time in measuring and collecting data. Sometimes gathering data becomes more expensive than actual benefit that we get from it.

In summary, we should be able to measure data and create a culture of decision making based on data. This will help us in creating benchmark year on year and lead to continual improvement.

 

 

 

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We live in the age of competition, where everything is controlled, measured and compared. 

 

  • We want everything to be monitored – monitor your investments
  • We want to control all that we monitor – Control our teams and children
  • We want to measure all that we try to control - Team’s output or children’s academic performance.
  • We want to manage everything – Today’s life.

 

Gone are the days when we allowed people to be as they are, work at their pace and allow the world to grow at its own pace.  We want to rush and hurry in everything.  We ended up having annual returns to half yearly returns and now its quarterly returns.  Humans are highly stressed because we tried all the above with people, children, marks, performance, returns, work etc.  We stretch beyond ourselves in these activities. Now we ended up with B.P normal range, Diabetics normal range etc., we are now defining all possible things with every organ in the human body. 

 

Man was at peace and ease when he believed that we as individuals contribute at a micro level on a macro level.  We now want to achieve everything at the macro level and ended up in pieces and diseases.

 

"It is wrong to suppose that if you can't measure it, you can't manage it. The most important numbers are unknown and unknowable"

 

This is a profound statement.  We need to measure only if we have to compare. For better management, all we need is to allow people and things to be.  The best results are achieved when we are at peace and relaxed.  Story writers, lyricists, painters, artists understand the importance of not being measured and compared.  Creativity is at its best when at rest.

 

This does not mean we are recluse or lethargic or disinterested.  A gardener manages the garden, whereas in a forest weeds grow uncontrolled.

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Of course if we cannot measure, we won't be able to manage. However, measurement alone isn’t enough to manage because there will be other known/unknown factors which cannot be measured which could be an impact on the management i.e., emotional state of an individual within the process, the ideas that will be used for the betterment of the process/system.

 

However, measurement is essential for a good management because to have a good management on any perspective (Professional/Personal), one should or should be able to measure the position of an individual or a system/process and the destination to be reached by an individual or a system.

 

Edward W Deming meant in his statement that the things that cannot be measured can also be managed. Ex one cannot measure the dedication/determination of an individual but, still a positive influence/motivation on it can give a desired output.

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We firmly believe that measurement is essential for good management as this helps management in executing the strategy and achieving the top & bottom line performance

 

Lets understand the terms in simple language.

 

Dashboards :  Dashboard in simple term can be explained as “ Eyes on performance” It is a glance report which  

 

         Gives transparent view of Performance …

          Helps in escalating abnormalities

          Decision making @ working level …

          Showcase Successes …

 

Numbers: There the figures which depicts performance when measured against target/AOP

 

Metrics: It is a standard of measurement by which efficiency & effectiveness of a process can be assessed. Metrics are calculated for both input (Lead) & Output (Lag KPI’s)

 

 

Input KPI

Out KPI

Efficiency

Material

Volume

Resource

Time

 

Cost

Effectiveness

 

Quality

 

Defects

Experience

 

Perception

 

CTQ’s: ”Critical to Quality are the key measurable characteristics of a product or process whose performance standards or specification limits must be met in order to satisfy the customer.”  ( as per Wikipedia)

 

Understanding above terms, Peter drucker has rightly said that if we cannot measure our performance, we will not able to manage the business.

 

.

A shopkeeper who is managing a shop also keeps a record of all transaction and analyse basis the numbers recorded. Eg he plans to buy the products basis the quantity left in his shop. And how much quantity is left is known to him basis his records. Same is true for any company as till the time they do not measure their performance, company cannot grow.

However if all company have a measurement system, then all companies should flourish. But this does not happen.

 

Reason:

a)      There are processes, transaction, work system whose efficiency/ effectiveness cannot be measured therefore in absence of their measurement, the management oversees these process.

b.)    What needs to be measured has to be properly identified. Metrics to be measured should be identified by applying any of the below simple methodology

1)      Lead & Lag KPI’s ( basis efficiency, effectiveness & perceptions measurements)

2)      Translating VOC/VOB into process lead & Lag KPI’s

3)      KPI’s related to hidden cost

 

Quote

"It is wrong to suppose that if you can't measure it, you can't manage it. The most important numbers are unknown and unknowable" - Dr. W. Edward Deming

Edward, as by this statement, is trying to highlight the hidden factory of KPI which are not measured and may bear high cost for correction when identified.

Lets understand the complexity with an example.

A proper BPMS was rolled out in a company which will work as a process repository and from where key metrics dashboards can be downloaded. It was launched with proper branding and training was given to all the employees in batches. Processes were uploaded in the system and links were shared. Post 6 month of launch, process team decided to measure the performance as this was one of the KRA item. Therefore they started flashing the No of Users KPI. To increase the number, team used to keep the follow and asked each employee to login once. This helped in achieving the KPI of % users of BPMS tool. However when audit was done , it was found that there was deviation in the employees process knowledge & process uploaded in BPMS tool. This was because no one took the pain of visiting and reading the process uploaded rather continued with earlier word version which were shared with them prior to launch of BPMS. This was a KPI which was never measured the other KPI measured gave the target achievement.

CTQ and.docx

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CTQ and Matric:

 

CTQ is a factor that is supposed to be critical to achieve the required quality, where as Matric is connected with measurements.

 

Measurement is not essential for a good management. 

Bcz, a good management is nothing to do with only measurement. There are a lot of things we cannot measure, for example motivation cannot be measured whereas it is one of the important catalyst for successful business. 

 

It is right approach, right intentions, empowerment are some of the important areas to be considered for a good management.

 

what Dr. Edward meant I believe is that, not everything in life can be measured and business is not different from life. Hence it is not fully true that everything that cannot be measured cannot be managed.

 

Actually, a good management can still be made exist with out measurement.

Measurement is a mere not a high level compared to human intentions, Good team work, and so on.

 

 

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As per the quotes:

If you can measure it you can manage it.

It is wrong to suppose that if you can't measure it , you cant manage it. The most important nos. Are unknown and unknowable. 

View: 1st quote by Peter Drucker is a direct statement which simplifically says that if you have known facts and figures you can manage the situation.  

The quote is not a contradictory to the other one. However, as per the other quote,what if the fact and figures are not known or unknowable, the quote by Dr Deming is an indirect one which states that sometimes the data remains hidden or discreet. To measure and manage the situation we can always have analytical methods to take out the hidden fact and figures. 

Now, as both the quotes are equally valid it can be said as measurement is always essential for good management.  Without measurement or analysis, facts and figures will be unknown, we cannot act on what is right. In organisation there are several CTQ, some may be on priority. So to manage it is necessary  to know the CTQ. 

Measure and manage is always a efficient method.

 

Edited by Mr. Abhijeet
Punctuation error

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Measurement is required for a good management but to approx. Or nearest to real. Exact measurement cannot be made in every situations specially in situations which changes from time to time.

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Edward W Deming mean by his statement - He believed in the value of using data to help improve the management of organisation. But he also knew that it wasn't enough.There are many things that can not be measured and still must be managed.

He meant that it is not always necessary that one can not manage without data, as it will not be available everytime to measure. We need to manage systems even if we cannot collect data as the most important figures are unknown or cannot be Known: 

Example: Return on investment from sending an employee to training (Here we know that issues can be managed/ improved by sending an employee for proper training to brush his knowledge and skills. And we cannot measure to what extent mistakes will be improved prior to training. We can just say it will improve.

 

My view - Measurement is not always essential for having good management as there are many things that cannot be measured and managers still have to make decisions about it.

Also to justify more "3% of the problems have figures,whereas 97% of the problems do not have figures". 

Also its not always necessary that the management techniques that one gets with data will be accurate. Some time it needs more logical thinking beyond the data that is available.

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Performance measurement is the process of collecting, analyzing and reporting information regarding the performance of an individual, group, organization, system or component. One of the most important aspects to be considered in relation to performance measurement process is that the performance measures work qualitatively to provide the useful information about products, processes and services that are produced in a business. Hence, implementing performance measures is a great way to understand and manage and improve what a a business organization does.

The measurement of performance is a continuous process which involves checking the performance against the standards that have been fixed to be followed. It leads to compare the actual performance with the established standards. A manager needs to supervise, observe and control the activities of his subordinates while he is involved in studying various summaries or reports, so that he may manage the work in an effective manner getting the things accomplished in a desirable manner. It requires the manager to constantly check the performance in order to take corrective actions in case of deviations ensuring that such deviations do not occur gain. Thus the Performance measurement is an ongoing, continuous improvement operation.

 

“If you try to control everything, you may end up controlling nothing.”

 

The importance of performance measurement system lies in the fact that it not only improves the performance, but also the productivity of a business entity by reducing costs. It is a good way to align the activities with the plans being established. It provides necessary feedback that the activities may be guided accordingly by allowing managers to implement best practices. It may thus be said that performance measurement process is a great way to understand, manage and improve the overall functioning state of a business organization. If done effectively and efficiently, it drives success in business definitely.

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We agree with deming,

 

Justification – if we can quantify the thing, we can manage it, however there are so many parameters which can never be quantified, but they matter, such as mood of the employee. No one can predict or quantify it, but it matters.

 

As mood of the person has direct impact on performance and if we can develop that equation then we can have some opinion on the non-quantifiable variable. We also want to make it clear that there can be lot of variables on which mood of the person depends which may be quantifiable or may not be quantifiable. But we one want to study the impact of bad mood of person then one can do by tagging it with quantifiable variable.

 

To say that “what can be quantified, can be managed” is applicable superficially. But if one starts digging into details then one may find many variables which can leads to mismanagement.

 

Data is good but if not available, situation can be managed.

 

But same time when we find anything room for improvements, which means there is something in it. This something can be considered as a data. There is something which can be improve and we measure this data with reference to other.

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If you are not measuring something there are chances that you will end up assuming things are okay when maybe they are not.

  • Yes, measurement is essential for good management.

Right measurements can help make right decisions for the business. By measuring the size and scope of the problem or performance gap with the relevant Dashboards, Numbers, Metrics, CTQs, we can determine how big, how bad or how widespread it is.

 

As per quote from Edward W Deming, even if you can’t measure something or exactly what you want, you can learn about the area with related data. You won’t be able to measure the exact benefit of a happy customer but you can get measures that give you an insight of the value & magnitude. Some of the complex concepts such as work culture, the psychological effect of a certain policy, work appreciation; these measurements cannot be done with accuracy.

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Albert Einstein said "Not everything that can be counted counts and not everything that counts can be counted"

I believe that measuring outputs like performance, efficiency and effectiveness is a must in making informed decisions. However we should not limit ourselves to what we can see or measure at this point in time rather keep open to possibilities which are beyond our imagination. It is not about ideas we cannot operationalise. It is about concepts that we don't yet have.

Practically, it should be a balance between Peter Drucker's and Dr. Deming's statements.

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If you can't measure it, you can't manage it – its true every process and every procedure should be measurable. Dashboard visualizes the Key Performance Indicators and other strategic data of an organization at a glance. Numbers are used to track KPI’s, metrics and other key data points. 

 

"It is wrong to suppose that if you can't measure it, you can't manage it. The most important numbers are unknown and unknowable" - Dr. W. Edward Deming – Deming’s sentence doesn’t mean that we have to ignore the numbers, metrics and dashboards, they show the common causes variations. He mean to say that special cause variations also lead to process variations and CTQ’s. Considering only numbers and ignoring the special causes may not show successful process improvements or exact root cause findings.

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Peter Drucker and Deming both are correct in their own context. Analysis of data is essential to get a snap shot picture of the current situation. This is a basic step to assess the current level of performance of a CTQ parameter and helps in its improvement.

But, what Deming means is that the business is much more than 'data'. Data or metric represent just a small subset of the whole picture, actual business depends on many other things which are much more important than data. For example many a times most powerful decisions don't emerge from meticulous 'data analysis', they come from smart understanding of the business environment or sometime even from 'gut feelings'. Now a days lot of emphasis is given to the management of human emotions, which, no doubt, is utmost important but at the same time can't be measured, but still to be managed!

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Measurement  is essential for good management.  

 

Why do we need Measurement ?

 

Various reasons can be attributed to this.

1.       Having a quantitative/measurable  data , helps in seeing the progress of improvement of the said activity(say CTQ/Metric/ parameters in a dashboard )
2.       Its easy to compare the current performance (AS-IS) with  the TO-BE performance and portray the difference gained ,to the key stakeholders
3.       Quantitative/Measurable data will provide transparency for all to discuss and debate
4.       Quantitative/Measurable data can also imply naturally, the time in which the data was taken. This will provide a clue as how long an issue/scenario was existing
5.       Quantitative/Measurable data

 

Now we know the reasons . Let us also focus on how to efficiently measure data and also see the challenges in measuring the data.

How do we achieve efficient measuring data ?

1.        A metric/CTQ/Parameters of a dashboard should be defined such that it should follow  ‘SMART’ rule.
2.        A general dictum is to have a Continuous data for a variable which needs to be measured. The reason being with continuous data , there would be more data to analyze or find a

             trend as how things are going. Sufficient data would be there to take decisions/arrive at solutions.

 

             For instance, rather than saying whether  students passed or failed, its better to say how   many  students passed . Similarly , customers could be more interested to know about the

            no.of defects failed, rather than a mere status on pass/fail

 

Challenges in measuring data:

1.       There should be a proper measuring system in place to measure your data
2.       The measuring system should be highly calibrated such that you are able to measure your data at the unit level desired by you

 

Exceptions

There could be some exception cases, where measurement might be difficult or not suffice. In such a case an approximation (close to reality) should be done.  

 

 Eg:  There could be intangible metrics/factors. Say for instance, if you are having a dashboard for Customer Satisfaction Survey and one of the parameters happen to be ‘Feel Good 

          Factor’ , then it can be difficult to measure.  The answer can be say, “good, “bad”,” excellent”.  If it is deemed as “bad” , then tracking the data going forward,  so that it changes to

         “Excellent” in the nearby future would remain a challenge.

 

View on Deming’s Quote

1.       Dr.Deming devised a list of 7 deadly diseases(statements made out by him)  which portrayed how numerical/measurable data were misused generously by management teams/key

           stakeholders  in organisations/industries, government institutions and other institutions in America, to satisfy their needs.

2.       In an organisation , management/Key stakeholders would focus on the number aspects. They would worry about the end results . But they would not understand the means for

           achieving that and would not bother to know how they are measured.  This is one of Dr.Deming’s list of 7 deadly diseases which captures this. Below is the message related to this.

           “Management by use only of visible figures, with little or no consideration of figures that are unknown or unknowable”

 

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Number become important as the maturity of system goes up. To start off with since the system itself is vulnerable, may be measurement system may not be reliable. But as the system gets matured, to make finer improvement in the system, numbers play important role.

Edward W Deming meant that measurement may not be a must to manage the system and measurement systems cannot be perfected to depict exactly how the system is behaving.

Overall it would make sense to improve measurement system constantly and also use it in line with the subject matter expert's assessment of the system, hand in hand in. Together they would help understand system and take it to next level.

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Dr. Deming did very much believed in the value of using data to help improve the organization.But he also knew that it wasn’t enough. There are many things that cannot be measured but still have to be managed & there are many things that cannot be measured and managers must still make decisions about.

 

Refer to the Quote of Lloyd S. Nelson "figures on the most important areas of management are unknown or unknowable, and successful managers must nevertheless manage those areas."

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I agree to Mr. Edward 

1.Management which will follow numbers, Dashboards will have linear growth. 

 

2.If the Organization need to grow exponentially, they need to follow innovative thinking & innovative process  rather than following numbers, dashboards. If we rely on numbers, dashboards of past or present, we will start assuming which will prevent us from out of box thinking. 

 

3.For example, Management is made by group of people. Each one has got their own talents. We need to use their talents in respective areas and move forward(Aces in places). If we assign numbers or dash boards to their performance, then we are limiting their performance. They might achieve better than that. 

 

 

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"If you can't measure it, you can't manage it" - Peter Drucker.

In simple words it means MEASURE to MANAGE. It implies that if you wish to improve and manage a metric the same should be quantified first. Only when the metric can be quantified would one be able to gauge if they have been succeful in adjusting the existing processes to produce the desired results.

 

Other authors too understand the importance of data in making informed decsions. American Statistician W. Edwards Deming has gone to the extent of saying: "In God we trust, all others must bring data." So this implies that having quantifiable data makes us a more informed decision maker since we can detect whether we have been successful or unsuccessful in our pursuit.

 

However, there are some aspects which are qualitative and can't be measured. So, does that mean what cant be measured can be managed. The same is not true. While data does help us in making well-informed decisions, lack of it doesnt deter us from improving the processes and making them more efficient. And as it is said, the most important numbers are unknown and unknowable.

 

So, what should I do to manage effectively: Keep your eyes open for all different pieces of data and don't rely on metrics alone to drive improvements and efficiencies.
 

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What is Measurement.?

 

It is the process of collecting, analyzing and reporting information regarding the performance of an individual, group, organization, system or component. One of the most important aspects to be considered in relation to performance measurement process is that the performance measures work qualitatively to provide the useful information about products, processes, and services that are produced in a business. Hence, implementing performance measures is a great way to understand and manage and improve what a business organization does.

The measurement of performance is a continuous process which involves checking the performance against the standards that have been fixed to be followed. It leads to comparing the actual performance with the established standards.

 

Example - A manager needs to supervise, observe and control the activities of his subordinates while he is involved in studying various summaries or reports, so that he may manage the work in an effective manner getting the things accomplished in a desirable manner. It requires the manager to constantly check the performance in order to take corrective actions in case of deviations ensuring that such deviations do not occur again. Thus the Performance measurement is an ongoing, continuous improvement operation.

 

As stated above, the process of performance measurement leads to comparing the actual performance with the standards. This, in turn, helps managers to understand the extent at which the performance is getting deviated from the expected ones. This way determining whether performance matches standards entails evaluating the differences and take necessary actions to improve the performance. However, while analyzing deviations, it is important to consider that some deviations in performance can be expected and so control by exception is used in this way. It is therefore important that a manager should concentrate on exceptional deviations instead of trying to control each and every deviation. According to management by exception principle by Fredrick W. Taylor, Managers should concentrate on only exceptional deviations instead of trying to correct each and every deviation. It is also worth mentioning the saying, “If you try to control everything, you may end up controlling nothing.”

 

The importance of performance measurement system lies in the fact that it not only improves the performance but also the productivity of a business entity by reducing costs. It is a good way to align the activities with the plans being established. It provides necessary feedback that the activities may be guided accordingly by allowing managers to implement best practices. It may thus be said that performance measurement process is a great way to understand, manage and improve the overall functioning state of a business organization. If done effectively and efficiently, it drives success in business definitely.

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