When I graduated from high school my first job was a sales position with Cutco knives. I did not last long as a knife salesperson, but I did learn a valuable lesson. My first report to the sales manager he asked about my activities from the previous week. There was a box for “number of contacts made” and I went into a narrative about all the reasons why I had not made many contacts. He stopped me and said (as best as I recall) “ Dave, you see that tiny box (pointing to the box on the sales report for contacts made) I only have room for a number – and no room for excuses. What is the number of contacts you made last week?” I realized quickly that contacts were a leading indicator to sales, and that in the final analysis excuses did not make sales – contacts did!
A key matter is to get the:
right information
to the right audience
at the right time.
Get any of these wrong, and we get sub-optimal outcomes. Recently my organization had significant growth goals. We identified problems in the phones process as a barrier to meeting those goals. It was so important and timely that we had a daily email go out to the clinic staff and supervisors on our key phone metrics (Avg. wait time, maximum wait time & calls abandoned), and a weekly summary. The phone team huddled every morning to review the metrics and problem solve ways to improve the numbers. We reviewed these metrics weekly at the clinic level, and at our weekly senior leadership meeting. With this level of attention it only took a couple of weeks to bring our numbers much closer to goal. Other solutions were more systemic and will take more time, so we continue to measure but report out less frequently.
As a starting place, key metrics should be developed, then refined over time. The worst thing is to measure nothing while trying to get the perfect metrics in place. Metrics at the executive level should be fairly concise, ideally graphical, and speak to what can be managed. Metrics should ideally be provided in context of other information (ratios), key strategies, and or historical data and benchmarks. To be most effective metrics should include both leading and lagging indicators. Lagging indicators are historical i.e. financial data. Leading indicators identify trends and causes for increases or decreases in results i.e. patient satisfaction. Others tend to provide both types of information i.e. trend lines of emergency room utilization. Ideally metrics are built in as a normal part of the day to day work, and would be automated as much as possible. I am a huge fan of publicly displayed information – be it electronic or as simple as a white board. Visual accountability is a foundational principle in all lean operations. Measurement and accountability should be at the level of the people doing the work. QI folks might get involved – but in a supporting role.
At the executive level organization wide metrics should be made available, no less than monthly, and some items should be available on a weekly or even a daily basis. Key measures should be tied to the organizations strategic plan and goals. By linking measures to the strategic plan we begin to establish a culture of accountability to the strategy.
Metrics are essential to leadership, strategy, and management. Typically strategic metrics would measure vision and goals on a organization wide level and are limited in quantity – perhaps 3-5. In fact at each organizational layer there should be no more than a handful of metrics in order to encourage focus, and they should cascade up i.e. first level supervisor metrics are more detailed and differ from manager metrics – but are related and support manager level metrics, which are different but related to director level metrics, etc. Metrics at each level are actionable at that level. Organizational metrics should ideally cover a broad range of dimensions i.e. financial, patient, quality, productivity, human resources, etc. The balanced scorecard folks propose key areas, and the Studer Group have their pillars. What they are, and how many there are in a given dimension is dependant upon the needs of your organization and need to be tied to your culture and strategies.
Finally a key difference between a measure and a metric is that a measure is just a number, a metric includes a target. A target implies a goal, and again supports an accountability culture. Huddles, team meetings, and board meetings should all include accountability to the metrics. If they truly support each other as they cascade up to the board, and you have appropriate accountability systems in place, your metrics will lead to tremendous mission and financial accomplishment.