Accountability is critical at every level of every organization, whether you lead a startup, nonprofit, or government agency. In this series, we discuss each element of accountability, why it matters, and ways to build it on your team.
We’re starting Part 3 of our journey through accountability. As a reminder, the five elements of accountability are (1) clear expectations, (2) clear capabilities, (3) clear measurement, (4) clear feedback, and (5) clear consequences. In the next posts, we dive into measurement.
Why Measurement Matters
As a leader, it is critical to know whether your team is doing its job well. But without measurements, it's hard to tell.
When I started as an executive in a government agency, my team was just starting a reorganization, had very few performance indicators, and faced a constant stream of fires that required my immediate attention (e.g., preparing for legislative hearings, redesigning a major program following changes to the law, and resolving high-profile customer complaints). I was responsible for over 50 employees and over 30 different public finance programs, each with its own unique subject matter. I only had 24 hours in a day, and I couldn’t master everything all at once. Early on, the only way to assess whether my team did a good job was whether we could make it through a day without a new fire drill cropping up. Definitely not an ideal way to lead a team.
Measurement is critical to managing your team’s performance. In very basic terms, leaders are charged with leading their teams from A to B. Without measurements, there is no way to tell where A actually is, or whether you’ve reached B. But if leaders measure the right things and set proper context for the data, they can quickly tell what their teams do well and where they need to improve.
What Should You Measure?
As a leader, you need to identify what SHOULD be measured. There are many things your team CAN measure, and some metrics will be easier to collect and analyze than others. But the more things you measure, the more time your team will spend collecting and analyzing information (and not focusing on their core work).
Instead of jumping into everything you COULD measure, you can save your team a lot of time and energy by defining what matters most.
Not sure where to begin? Consider starting with your key stakeholders - what does success look like to them?
…For your customers/clients?
Examples might include the length of application review/approval, the quality of your products/services, response time from your customer service representatives, or the safety of your facilities.
…For your teammates?
Examples might include diversity, equity, and inclusion, feeling engaged at work, minimizing error rates for customer application reviews, amount of sales per year, or number of widgets produced or clients served over a period of time.
…For your other stakeholders? (e.g., board members, investors, donors)
Examples might include quarterly earnings, environmental impact, or the number of low-income individuals served.
How Can You Measure It?
After you identify what matters most for your team, you can determine the best way to measure it.
(Note: I owe my measurement philosophy, including the following measurement types, to Drew Erdmann, Missouri’s former Chief Operating Officer and catalyst of Missouri state government's operational excellence movement.)
There are four basic types of measurement:
(1) Activity
Activity focuses on what your team does. You can think of activity measures as the inputs that your team contributes to its overall mission.
Examples include:
Number of clients served
Number of town halls or community- engagement events hosted
Amount of grant funds distributed
(2) Quality
Quality tells you how well your team does its job. This measure can be quantitative or qualitative, depending on what you measure.
Examples include:
Customer satisfaction surveys
Error rates in application review
Open rates for marketing emails
Published rankings comparing your team’s performance to its peer organizations
(3) Impact
Impact is what happens as a result of your team’s work. If activity measures are the inputs, impact measures are the outputs.
Examples include:
The number of families who no longer need government welfare programs after going through a workforce development program
Changes to a company’s profitability due to a specific activity
Higher employee retention compared to previous years
(4) Efficiency
Efficiency focuses on how cost-effective something is. You can use it to determine the return on your investment of time, money, or other resources.
Examples include:
Hours of staff review time per application
Acquisition cost per new customer/donor
Public funding invested per homeless person sheltered
Questions for Leaders:
For each of your team’s functions, can you identify what success looks like?
Do you know what success means for each of your team’s key stakeholder groups (e.g., customers/clients, employees, investors)?
Do you have enough data to start measuring the things that matter? If not, what data do you need?
What kinds of measurements does your team currently use? Do you use a mix of all four types, or are you skewed towards only one measurement type (e.g., almost all activity measures)?
Next Time:
Once you start measuring the things that matter most, you can get a clearer sense of your team’s performance. Next time, we will discuss how to set targets to help your team get better.
Michael Lanahan serves as Founder and Principal of MBL Ventures, a management consulting firm that helps business, nonprofit, and public sector leaders navigate issues of strategy, structure, and government.
To learn more, please visit www.mblventuresllc.com.
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