In a fast changing environment, and especially when the economical conditions are challenging, leaders must take good decisions. We all know it, and the purpose of this article it not there.

When you start a new initiative, when you decide to change something in your organization, you want to measure the impact and the results of this change. So if we agree on the say that “what you measure is what you get”, we must also pay attention to what and how we measure, how we report.

Indeed, if you don't define your metrics correctly, your people will try to optimize their measured results and personal KPI's, not necessary in line with your expectations. And if you need a long time to calculate your metrics, you won't have any chance to take the corrective measures on time.

A few example :

  • an organization based its next year budgets on the customer segmentation of the year before because updating the planning system takes too long;
  • another measures the productivity of its sales teams based on the amount of customer travels but not on the content of the meetings and the type of products proposed to customers;
  • to reduce its cash requirements, an organization wanted to incentive each line manager to cash savings but was unable to report on cash use per department;

As showed in the examples above, producing the right KPI's and metrics, on time, in context, delivered to the right stakeholder, is still a challenge in many organizations. In a recent IBM Institute for Business Value (IBV) study, one in three business leaders admitted they had made major decisions with incomplete information or information they don’t trust !

Unavailability of data is definitely not the cause. Data is everywhere. Today's challenge is not collecting data but managing data and organizing it. And to address the issue of data quality, CIO's and IT managers are offered a complete portfolio of solutions from IBM and other vendors. Thus, we can say that managing huge volume of data is not a matter of technology but of business priority, of arbitrage between projects.

To me, if business leaders do not base their decisions on data and information, it is because their reporting environment does not allow them to quickly access the information they need, when they need it. Organizations should empower their information consumers so their can immediately define and report on the metrics and KPI they need. Self-service. Fast and direct. User friendly. No need for developers, IT and other parties. You know what you want, do it your self!

And then, as decision maker, you'll be able to immediately measure the results of your decisions, assess the impact of further changes, simulate changes, … i.e. drive your organization. Based on your metrics, not those of last year because implementing new in your report would costs weeks of time and lots of money.

The same environment must allow your staff and line managers to access their metrics and KPI's. Completely aligned with those coming from the top to avoid people pursuing personal strategies just to optimize their performance and not the organization performance.

So, yes, reporting environment (nowadays called Performance Management solutions) help driving the organization, not only by helping leaders to take the best decision but also by making sure that the entire organization is aligned through the use of precise and tailor-made KPI measurements and reporting.

Perhaps what you measure is what you get. More likely, what you measure is all you’ll get. What you don’t (or can’t) measure is lost" - H. Thomas Johnson

Source : The reference to the quote of Dr. Johson comes from the blog of James Considine where he mentions this quote.