Have you ever tried to assemble a puzzle without the picture on the box? It's challenging, isn't it? You're not sure where each piece fits or even what the final image should look like. This is similar to managing a business change project without clear success metrics. Without them, you're navigating through change blindly, unsure if your efforts are leading towards success or failure. How will you know if outcomes have been achieved and the spend justified, if you don't establish clear metrics with which to measure success?
In this post, we'll explore the importance of clarity on the core outcome the change is tasked to deliver and the four crucial metrics that serve as guiding stars for successful measurement. Once we understand the main outcome, we can define the measurable benefit(s) it accrues. These metrics not only help measure progress but also predict potential obstacles and ensure a smooth transition from old ways to new beginnings.
Note that it's never too early to think about your success measures. It should be on the table during project initiation and form the core of the benefits realisation section of the Business Case.
Clarity on Outcome and the Link to Strategic Purpose
Before you can develop great success measurement metrics you must be crystal clear on the outcome the change delivers. Many a project has come to grief where there is confusion over this pivotal item. Let's use the example of a major transformation in the national police force. I hasten to add I've never worked on a major transformation in the police force, it just works as a good example.
Before the core change outcome can be established on a large-scale transformation, you need to be clear on the overall organisational purpose. This provides the outcome link to strategy. If you're clear on organisational purpose, then you can draw the through-line to the strategy that enables that purpose, and how your piece of work contributes to that strategy.
The core purpose of the New Zealand police force, as stated on their website, is to enforce the law. But if we ask ourselves what the POINT is of enforcing the law, we might decide to reframe the core purpose as being to protect the public from harm and prevent the complex social and economic consequences of crime. Following this line of thinking, the more fundamental role of the police is to reduce crime, in conjunction with a range of other agencies. If we say this is the core purpose, then we move the success measurement dial for our prospective transformation programme away from punishment of crime measures and more towards crime prevention measures (which is increasingly the direction that this organisation and other regulatory bodies are moving towards as compared to say, fifty years ago).
To quantify this outcome accurately, we would need to be very certain that the ways we measure the overall crime reduction are rock solid. Are we just looking for, say a decrease in the total overall number of crimes in a specified period, or would we set a specific metric against the reduction of serious crime only?
I use this example to illustrate that truly identifying organisational purpose can be complicated and requires thoughtful consideration, as is establishment of the right metrics to inform it. My go-to question to interrogate the status quo perception of organisational purpose AND programme outcome is to ask, 'and so what about that?'
If we do go with reduction in crime, the overall metric for the transformation programme might be a ten percent reduction in crime within two years. Once we're clear on the organisational core purpose it is a matter of establishing how the transformation programme outcome enables that purpose and what are the associated measurable benefits.
Of course, sometimes metrics can be more straightforward. Say a bank project change is increasing automation of its lending process. It might measure the project's success on the basis of the following.
A twenty percent decrease in the time taken from lending application to final decision.
A thirty percent reduction in staff levels to process the loan.
A forty percent reduction in the overall cost to bank operations of running the lending process in a specified period.
A twenty-five percent reduction in the writing of bad debt (on the basis that the algorithms that check for potential bad debtors provide more thorough customer vetting which increases the predictive accuracy of declining bad business).
The Core Types of Metrics
#1: The Lighthouse - Employee Engagement Metrics
Think of employee engagement as a lighthouse in the stormy sea of change. When employees are engaged, they become active participants rather than passive observers in the process.
To measure this, consider surveying employees before, during and after implementing changes. Ask questions about their understanding of why changes are necessary, their role in it and how well they feel supported throughout the process. A rise in engagement scores indicates that you're sailing towards successful shores. These types of measured responses form the core of your business readiness assessment exercise.
More meaningful than scores that just measure participation i.e., 'eight hundred people dialed into the project update webinar', are measures that relate to an uplift in skills and competencies. An example would be, 'seventy-three percent of employees responded that their ability to manage customer complaints has improved significantly'. You want to see this reflected in a correlating increase in customer satisfaction in the way that complaints are resolved, and possibly a reduction in the time taken to resolve.
This also demonstrates that metrics are often more meaningful when a story can be told across a number of measures.
Be sure to set realistic expectations with your Executive team about the scale of these measures. For engagement scores, anything above a seventy percent favourable response is extremely good. Often, depending on the culture, nature of the business, and what precisely the change delivers, a positive engagement score above sixty percent is great.
#2: The Compass - Project Milestone Metrics
Just like a compass points north, project milestone metrics guide your path through each phase of your project. They break down complex processes into manageable chunks and provide tangible goals to strive for.
Project managers can monitor how closely the team follows planned timelines and budgets for each milestone. Ideally, they have co-designed these targets! Delays or overspending could signal underlying issues that need immediate attention before they escalate into larger problems. These types of metrics should be set up by the Project or Programme Manager and discussed regularly with the Steering Committee and sponsor at each review meeting.
#3: The Weather Vane - Customer Satisfaction/Efficiency and Effectiveness Metrics
Imagine customer satisfaction as a weathervane indicating which way the wind blows – towards favorability or dissatisfaction with implemented changes.
Track customer feedback through surveys or reviews regarding service quality, product improvements or overall experience following changes made within your organisation. Remember that happy customers often lead to increased sales and brand loyalty – clear skies ahead!
Efficiency and effectiveness measures can be set where process changes are implemented, and current state baseline metrics are already in play or can be established via time and motion study at both the process, team and individual level.
Here's some examples of these types of measures used on projects I've worked on previously.
A twenty percent reduction in the time taken to respond to a customer claim.
A thirty percent reduction in the time to decision on a customer lending request.
A fifteen percent reduction in the claim duration window.
You will notice here that these types of measures can apply to phases in the process hand-off or relate to the overall process duration. Depending on the complexity of what's being delivered, it's good to establish metrics at both the process stage and process duration levels. This provides much more surety on where exactly benefits are being realised, or not realised!
You can also have combination metrics established as follows.
A fifteen percent increase in customer satisfaction ratings based on a ten percent improvement in the call centre skills and competencies to manage customer residential valuation requests, plus a five percent reduction in call wait times.
Note that the relational math will usually be more complex than the example here - but it gives you the idea!
#4: The Barometer - Financial Performance Metrics
Financial performance metrics act like barometers measuring atmospheric pressure; they indicate whether conditions are favorable for growth after implementing changes and whether or not it was worth spending the money to make the change!
Assess key financial indicators such as revenue growth rate, profit margins or return on investment (ROI) post-change compared to pre-change figures. Positive trends suggest that changes have brought about financial stability and growth – signs of successful transformation!
Ideally, these metrics should be communicated effectively across all levels of the enterprise. In my experience, the appetite to do this very much depends on the cultural health of the organisation. Transparency fosters trust among team members while keeping everyone aligned with shared objectives. However, it takes a strong and committed sponsor to hold the line when newly communicated metrics will make performance levels more explicit!
There you have it! Just like navigational tools aid sailors on high seas adventures, a clear sense of the outcomes to be achieved and these four success measurement metrics can guide you confidently through any business change management project. This is how you can be assured it achieves the outcomes on which inception was based. Implement them wisely, be thoughtful in their conception to ensure they measure the right thing in the right ways and stay the course to ensure projects deliver on outcomes and do what they said they set out to do.
I'd love to hear how these 'navigational aids' have impacted your journey through organisational transformation.
To your change success!
PS Your thoughts and experiences matter! Don't hesitate to share them here so others, too can benefit from collective wisdom. I like to hear your thoughts and opinions and will respond directly.
Barb Grant, the author, is a master change practitioner who mentors change managers and change agents to deliver change that gets adopted and delivers meaningful results. She is the Director of Encompass Consulting, 'Bold Change' and CM2 change mentoring and author of the #1 Amazon bestselling book for change agents, 'Change Management that Sticks.' Barb is a frequent speaker on topics related to change management and the successful leadership of change.
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If you have a change leader, change agent, or change management practice that needs mentoring please use the contact form below or email Barb direct at firstname.lastname@example.org for a free no-obligation chat about your requirement.