Management Tip: Measuring Success - foamposites for cheap

Success Rate: how often do they succeed at their top objectives This can often be measured as a variance to expectations cole haan nike air .4. Cost of Failure: what does it cost when this team fails to achieve a top objective This can be dollars, but you can also use other soft measurements like satisfaction levels.

Production and Cost metrics are the big dollars and cents measurements needed to determine whats happening to the money kids air jordans . Success Rate and Cost of Failure are softer measurements.

Success Rate should be used primarily to highlight the great things that every department does each year, and look for opportunities for future improvement pink foamposites . Do not forget to use this metric to celebrate success.

Cost of Failure is the money lost because we didnt do what we said we would do Derrick Rose Jersey . This measurement helps us understand whether to stay the course, or try something new.

In general Production and Cost metrics dont change that much over time, but Success Rate and Cost of Failure metrics may change yearly to measure the specific top initiative(s) for that year.Let's look at a very practical example of measuring a business as a whole. Let's say your business is organized into four departments each with a specific objective and starting place.The Sales team's goal is to get a decision to purchase from the customerThe Orders team's goal is to sign a win-win contract with the customerThe Delivery team's goal is to collect the money by delivering our side of the contractThe Customer Service team's goal is to get repeat orders by creating satisfied usersBased on these expectations, the following is an example of some good top level metrics. The details will vary from company to company, but every company should measure the production of each team, the cost of each team, the success rate of each team on key initiatives, and the cost of failure of each team on key initiatives.Sales Team:Production = Total Sell PriceCost = Department CostsSuccess Rate = Number of New Qualified LeadsCost of Failure = Unsuccessful Lead Generation CostsOrders Team:Production = Profit Margin on Invoiced AmountCost = Department CostsSuccess Rate = Number of Qualified Leads who BoughtCost of Failure = Time Spent on Orders that we LostDelivery Team:Production = Profit Margin on Invoiced AmountsCost = Department CostsSuccess Rate = On Time DeliveriesCost of Failure = Cost of Rework, Late Shipments and ReturnsCustomer ServiceProduction = Value of Repeat OrdersCost = Department CostsSuccess Rate = Issue Resolution and Customer ContactsCost of Failure = Lost Revenue from Lost CustomersSummaryMetrics are an important part of all businesses. They are how we know whether we are doing well, or need to make some serious changes. There are a lot more metrics you can and should apply to your team, but it is important to always keep the big picture in mind. All too often team leaders go off measuring small things that dont matter and lose sight of the big picture.