Improving enterprise decision-making : the benefits of metric commonality

Abstract

The objective of this research is to identify a new approach in managing, and making internal program-level decisions from, externally tracked performance metrics. Industry observations indicate the increasing challenge for program managers and internal development teams to identify performance improvement opportunities for products, services, organizations, etc., in an effective and efficient manner based on tracked performance metrics by external customers. Literature on metrics; performance measurement selection, systems, and frameworks; the concept of commonality; and designing across a life cycle is assessed and helps generate a new concept of commonalizing metrics across an operating life cycle to address this issue. It is hypothesized that despite the uniqueness of each external stakeholder, the tracking of a small set of common performance metrics at different operating life cycle phases across all external stakeholders would result in more accurate decision-making in identifying the most value-added performance improvement opportunities, increased enterprise-level communication, and lower incurred costs. A detailed case study of a technical product with multiple customers whose external data drives internal program decisions is presented to address (1) if metric commonality is plausible, (2) what the expected benefits are of implementing this new decision-making tool, and (3) how these common metrics would change over the course of the product's operating life cycle. A historical data analysis and initial customer interviews established the architecture of the program's current state. Internal development team expert interviews and a second round of customer interviews were performed in an effort to identify an optimal set of common metrics the external stakeholders could track for this program. Also identified were proper adoption attributes that would need to be considered to not only drive this new decision-making tool through this enterprise, but also to address some of the barriers that influenced the program's current state. The triangulation of the historical, developer, and customer data sets produced a list of less than a dozen common, value-added metrics for this program, with most of these metrics consistently measured throughout the operating life cycle, supporting the plausibility of this new decision-making tool. Having all stakeholders recording the same metrics also improves the efficiency and effectiveness of making the right product improvement decisions, as well as increases communication within the product community. The study also provides insight into the importance of the voice of the customer, the relationship between metrics and strategic planning, the connection to lean thinking, and a new performance measurement framework; and is considered an excellent starting point for future detailed studies in this area.