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Are Your Measurements Making You Look Bad?

Dec 14, 2007
Most people view the measuring process too narrowly. When they do, they can look pretty foolish.

Here's an example: A corporate planner went to a seminar given by corporate strategist Peter Drucker. The planner asked Drucker to pick the best single measure of corporate performance. Drucker replied, "My dear sir, you obviously know nothing. There is no single measure of corporate performance that is any good. Use them all and try to develop new ones, and each will teach you something you need to know."

Drucker's point was that measurements are highly subjective and imperfect. Would-be stallbusters are going to need lots more measures.

Tailor Your Measurements to Fit

Measurements may need to be improved with adjustments. For instance, farm tractors cost a lot more now than they did in the 1930s, but they also do a lot more. If you measure cost per tractor, it looks like productivity declined. If you measure by cost per acre plowed in inflation-adjusted dollars, the cost of plowing has gone down substantially.

Feedback Nourishes Learning

It's not enough to measure. You also have to learn from what the measurements tell you. Then, when you can access information that competitors lack, you can sneak ahead.

Here's an example: Dell Corporation leads in personal computers and gains its orders through direct sales over the telephone and the Internet. Its competitors sell through wholesalers, value-added resellers, and stores. Dell is learning moment by moment what features its customers most want.

Competitors have to use indirect, after-the-fact measurements to estimate what Dell already knows. Dell can be out testing a new insight from daily measurements long before the competitors even know about the new customer need.

With each iteration of this feedback, Dell's knowledge moves further ahead of competitors. As a result of learning based on powerful measurements, Dell was able to steam ahead of all its well-known global competitors despite Dell's humble beginnings in Michael Dell's college dormitory room.


Use Measurements to Improve Your Personal Effectiveness

Ask yourself the following questions to better allocate your time and efforts:

1. How could I avoid having to do the least productive tasks at all and get better results?

2. How else could I have gotten these tasks done to get better results in less time?

3. How could I delegate these tasks to others for better results?

4. How could I inexpensively automate these tasks and meet my purposes?

5. When was I effective?

6. Why was I effective then?

7. When was I ineffective?

8. Why was I ineffective then?

9. How much time am I spending on time wasters?

10. How could I better spend the time I use on time wasters?

11. What will be the benefits to me and others of spending my time in these more productive areas?

Use Measurements to Improve the Effectiveness of Others

After you have acted on the answers to your personal improvement questions, you will be prepared to be credible as a helpful coach to others, especially with the answers to the following questions:

1. How can you interest other people in measurements?

2. How can you help others set up and use helpful measurements?

3. How can the message about the value of properly using measurements be spread even further?
About the Author
Donald Mitchell is coauthor of six books including The 2,000 Percent Squared Solution, The 2,000 Percent Solution, and The 2,000 Percent Solution Workbook. Read about creating breakthroughs through 2,000 percent solutions by registering for free at

http://www.2000percentsolution.com .
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