Let’s continue our deep dive into Strategic Preparation, my approach to aligning organizations to solve complex problems together, repeatedly over time. We started talking about measurement, the qualification and quantification of reality, and its three distinct, interrelated parts, each with a form and matching purpose:
Measures: the description of what you want to know more about (what and why)
Metrics: the specific definition of what you plan to measure (how and when)
Targets: the actual “goal” state for the metric, that which you are driving toward.
Today we pick up with metrics, where the rubber meets the road. If measures tell us where we want to go, metrics, like Key Results in OKRs let us know exactly where we are. Metrics are the specific technical definition of what you want to measure. They are uncompromising, indifferent to the challenge of obtaining them, and uncaring of how powerful they can be in steering your organization, for better or worse. Where measures are designed for communication and alignment, metrics are designed for feedback and learning.
The actual setting of metrics can grind an organization to a halt, with senior executives wanting to strangle their director level technical people who insist on enough clarity to measure while fearing the work of measurement itself. But the pushback is correct–metrics must be specific enough to actually be measured. As such, after setting measures and targets, you as senior leader should delegate specific metric setting to a team of those with the technical expertise, functional knowledge and responsibility for performance.
Your organization should endeavor to discover metrics that are quantitative, linear and continuous, with “up” being “good.” I am convinced that this simplicity is the appeal of sports and sales (and why there is so much crossover between those populations): it is simple and straightforward to understand where you are and who is winning. For example: “We should increase revenue by $xxM by the end of the quarter.” Note the “xx” here represents the Target portion of the metric, and setting that will be covered later.
If only all of the complexity of life could be so easily captured. While metrics like “increasing revenue” are fairly clear, understanding the drivers of that revenue is an iterative discovery process that you wish you could just skip. Too bad, but learning is the fun part! Rather, early in your understanding of your business, you are much more likely to develop negative metrics–where “down” is “good,” milestone metrics such as “complete operating plan” or faux-quantitative percentile metrics such as “improve patient satisfaction by 5%” without understanding your baseline or unit of measure. That is to be expected as part of the learning process.
Let’s take a common example of just how hard this can be. Nearly all health services companies have to contend with measures like “patient engagement” as a predictor of satisfaction, impact and revenue. The idea here is that our service is something like a medicine, and so ensuring an adequate dose over time is necessary for proving efficacy. Additionally, many contracts in this space have some payment related engagement concept (always to be defined later).
Since it is such an often-used metric, let’s begin the discussion on how to measure engagement. First, let’s start with the behavior to measure. Is it a patient coming in for an appointment? Logging in to software? Reading an article or watching a video? Interacting with a care team? Members of your team will debate the ambiguous dilemma of “clinically meaningful” vs. “meeting the contract so we can get paid.” Then after you’ve decided on behaviors to measure, you have to examine the frequency of those behaviors. Should whatever suite of behaviors happen every 30 days? Is that too frequent and will crush your operations? Should it be every 90 days? Is that frequent enough to matter clinically? How do you know? Do you have to listen to the loudest doctor in the company?
Can you now feel the storm coming? And this is only one metric!
I’ve spent hours of my life in these conversations and here’s what I recommend: Let your people propose metrics that might work, and then pick one to focus on first. As any of the suggestions might be right, your best bet for success is to test a metric for one week to see what you learn about your measurement capabilities and the outcome itself, then adjust your metric and try again for another week. Bring disciplined, iterative agility to measurement and hold your people accountable for disciplined iteration, rather than hitting the decided upon, but premature, metric. If you attempt this, prepare for massive pushback across the organization for two reasons:
Change fatigue: If we keep changing what we measure every week, our people will be confused and we will fail.
This is a definite possibility, stemming from a desire for control over one’s destiny combined with a desire to avoid blame for failure that seems inevitable. This is the same reason you will fight with your employed doctors about their schedule.
Rather than change the measure every week (we still want to measure engagement), nor the underlying behavior measured, simply change how you count those behaviors to see what you learned. Toiling under an obviously stupid measure for a quarter is a FAR more demoralizing fate than having to change measurement approaches with predictable frequency. Similarly, reward progress toward discovering the metric rather than achieving it. Once you have the right metric, progress will proceed rapidly, maybe we call it “problem/metric fit?”
Measuring things is too much work
This is usually the root of all objections so I attack it aggressively. Simply put, your organization is out of shape. Running is hard when you are out of shape.
So walk, crawl even. Get moving to start getting back into shape. Start developing the discipline of measurement, immediately, or this objection will never cease. There’s no time like the present!
While these two objections are wholly legitimate, they neither alleviate the desperate need to measure your business nor continuously improve your measurement capabilities. Similarly, spending weeks debating metrics is usually inferior to spending weeks testing them. As you gain comfort with recursive metric iteration, you will find that you need fewer iterations to discover the correct metrics while being much more calm about the whole process. Stay the course and next up we will explore Targets.