Choosing business measures to monitor
There are a number of different ways you could potentially measure improvement.
Though it is often much easier to measure the inputs or resources you have invested to achieve the improvement, this doesn’t help to assess their impact. To help with this, many organisations also use feedback to try to gauge usefulness or satisfaction with activities such as training courses or newsletters.
But you need to establish measures of output in order to measure the real impact that activities have had – i.e. to find out whether they have really improved performance, rather than been enjoyable or not. These can include perceptions as well as ‘hard’, objective measures of organisational performance.
The following table discusses different types of measure and how they might be used:
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Type of measure
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Description
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Usefulness
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1. Input measures
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The amount of resource (money, effort, personnel, time etc) invested with the aim of achieving an improvement. For example, this might include the amount spent on training over a year, or the fact that the organisation hired a new HR manager.
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Only part of the picture - in order to establish whether the investment has been effective, you need to measure both the investment and its impact, and assess whether the return is greater than resources invested.
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2. Process measures
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The take-up and immediate feedback about the processes you use as part of implementing your strategy for improvement. For example, this might be the number of people trained, or take-up of work-life balance solutions, or overall ratings of how useful a training course has been.
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Helps to demonstrate that people in the organisation are engaged with the process, but not that overall performance has necessarily improved. Perceptions of the process (‘The course was enjoyable’) is often less important than perceptions of its impact (‘I feel more confident about doing X’).
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3. Output measures – perceptions
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How people feel about the results of the implementation of the strategy for improvement. For example, staff might say they are more satisfied with their jobs, or customers might feel the organisation meets their needs better.
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Sometimes, perceptions are the key focus of the improvement – such as becoming an ‘employer of choice’ amongst potential recruits or increasing employee morale. But in other cases, how people feel may be less relevant than what they do – whether they work more efficiently, buy more from the organisation or take fewer days sick leave.
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4. Output measures – results
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What the impact of the improvement has been on the critical measures of organisational performance. For example, this might be profit or turnover growth for companies, or performance against targets or inspection results for public sector bodies.
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Usually the ultimate driver for improvement is to have a positive impact on something the organisation needs to do well in order to prosper. But distinguishing the impact of different factors on achieving this improvement can be difficult – how much did profits increase by due to the improvement, relative to the state of the economy, advertising, etc?
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