Yogi Berra said, “You can see a lot by just looking.” Jacqueline Kosecoff, CEO of Prescription Solutions, a pharmacy benefit management company, makes “looking” a key aspect of her leadership. She believes that effective leadership includes measuring organizational performance and using that information to improve.

In an interview conducted by Adam Bryant for the New York Times, Kosecoff said:

I’m a great believer in measurement. So before I begin the execution phase of any project, I sit down with my team and we ask ourselves: “What are the metrics against which we’re going to measure our success?”

We do two things: We measure where we’re succeeding, and where we succeed we celebrate. And we also measure where we’re not succeeding, and where that happens we ask ourselves, “Can we go back and fix something?” And if so, we do it. And if not, we make sure that we understand where we went wrong, put it into the corporate DNA, so the next project won’t have that flaw.

Another thing I learned was that when you’re involved in a large development project, projects often morph. And when people become advocates of their project, they change some of those metrics so that they can claim success when perhaps it’s not 100 percent legitimate to do so.

So creating the metrics up front, and having a discipline of saying, “O.K., this is where we want to go, and if we don’t achieve it it’s O.K., we’ll try in another way to get there,” is very helpful. Not just for me, but for the whole team.

It sounds like common sense: “create the metrics up front.” However, often this is not what many companies do. They tend to choose a metric out of convenience rather than because it is the best indicator of the success they want. Take customer service for example. Is the goal a positive customer attitude toward the company, customer satisfaction with a buying experience, few customer complaints, a timely response to a question or complaint, a low number of product returns, on-time delivery, customer retention over time, customer referrals, or something else? A hospital can achieve high customer satisfaction scores on a customer survey if nothing bad happened during the patient visit, but is that what you want, merely adequate service? Or, should the service be outstanding? In that case other metrics are needed that require a little more effort, such as measuring the extent to which nurses and doctors treat patients with understanding and compassion (See: If Disney Ran Your Hospital: 9 ½  Things You Would Do Differently)? As Kosecoff suggests, first decide what you mean by “success” and then design a metric that will help you determine when and how that goal is achieved.

 

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