While many at UC Berkeley appreciate the importance of using metrics to manage to success, practices do tend to vary widely. Below are six best practice principles for those who wish to strengthen their performance measurement.
1: Where do I start? – Metrics in Context
Metrics can be rather overwhelming at first. If you would like to identify meaningful metrics but are unsure how to start, find the metrics that will help you to measure progress against your strategic plan.
Metrics that measure whether “we are doing things right” (efficiency metrics) are quite plentiful and relatively easy to measure (e.g., activities, services or projects that are delivered on time and/or on budget). These are useful but, in addition to these, it’s particularly important for public institutions, like ourselves at UC Berkeley, to use metrics that measure whether “we are doing the right things.” These effectiveness or “outcome” metrics link directly to our strategic goals and help establish what is important. Example outcome metrics at UC Berkeley include measures pertaining to enhanced student experience, standing relative to peer institutions, increased financial strength and high quality services etc.
2: Being Inclusive – Metrics provide a “common language”
Every organizational unit will typically have a set of both common and unique metrics against which to measure its strategic plan. Begin by working with a small set of common metrics. There are many advantages to using common metrics: (i) they tend to be readily accessible from institutional systems and have pre-agreed definitions, (ii) they can promote particular campus or unit goals (e.g., diversity indices or revenue goals) and (iii) they can be used to compare performance against peer groups or units (i.e., benchmarking studies). Common metrics exist by activity (e.g., teaching) and also by function (e.g., HR, Finance or IT activities). UC Berkeley boasts robust financial and data systems that allow the use of common metrics across departments. Cal Answers and Cal Planning are a couple examples that highlight how you can leverage big data to hone in on metrics and compare operations across a large and diverse campus.
3. Metrics Mantra – Quality over Quantity
Make sure your metrics pass the “so what” test. If metrics do not pass the “SMART” test (Specific, Measurable, Achievable, Realistic, Timely), they won’t be useful to monitor performance or to make meaningful decisions. Focus on the few key metrics that really inform strategy and performance. Metrics can be cascaded within a unit or organization, but only provide a simple handful of key metrics (per unit) for your leader to consider.
4: Use Metrics to drive action and results
Before you review metrics with a team, it’s very important to indicate how metrics will be used. Some units like to use the “traffic light” (red, amber, green). If so, it’s important to indicate that a “red” indicator should not be taken as a sign of failure but rather as an opportunity to undertake discussion and to develop an action plan.
Once you get to the stage that you are actually reviewing and discussing your “SMART” metrics, spend time reviewing the exceptions, changes and the actions. Actions should be aimed at improving the metric if performance is “off track”. Metrics that exceed expectations offer opportunities to capitalize on areas of strength.
5: Metrics will evolve
Trends from metrics data can be particularly useful to measure performance. At the same time, metrics and targets are likely to evolve over time due to many inevitable changing circumstances. Use common sense to retain a core set of useful key metrics and add (or subtract) accordingly. Overall, avoid delaying monitoring a key issue by searching for the “perfect metric” that is typically too difficult to source or to compute.
6: Metrics Limitations
Last but not least, it should be remembered that metrics will never be a substitute for decision making. Focus should always be on “managing the strategy” and not the metric.
For additional information and sources:
- http://vcaf.berkeley.edu/what-we-do/leading-best-practices/strategic-management-and- metrics-project