If you want to measure performance more effectively, first do a re-check of your strategic objectives

A friend recently invited me out for coffee to discuss a report she was preparing for her workplace. It was a summary of strategic objectives the organization is hoping to achieve over the next few years, and she was struggling to identify appropriate performance metrics to measure progress to the overall objectives.

As I reviewed the report, it quickly became clear that the problem didn’t lie in identifying performance metrics; instead, the problem was with the strategic objectives themselves. Some were well defined and easily quantified, but most were vague statements difficult to articulate, let alone measure.

Our discussion made me think about why companies find it difficult to implement and use performance metrics. One of the obvious conclusions is that if a company can’t outline clear strategic objectives, it will be impossible to develop meaningful performance metrics. An organization faces three major pitfalls when attempting to articulate future objectives. These include using weasel words, having multiple goals in a single statement, and creating non-quantifiable objectives.

1) The strategic objective uses “weasel words.” A weasel word is a vague term used to create an illusion of clarity or associated with highly valued concepts or beliefs. On the surface, a weasel word looks great, but analyze it and it comes up empty. The business world has countless examples of weasel words, and we’re all guilty of using them: productivity, efficiency, innovative, value-added, sustainable—the list goes on. What, you may say? But these words exemplify our ideals! Our company wants to be productive, efficient, and innovative. This is a very noble intention, but what does it mean? At what point do you say, “Excellent job, everyone, we are now productive.” How do you even define productivity? Ask three people in your company and you’ll likely get three different answers. How is one metric supposed to measure this?

The solution is simple: Weed out the weasels. Strategic objectives should be written in definable, measurable terms. So instead of “increased productivity” as a strategic objective, it’s much better to state “reduce average time between application date and processing.” Instead of “increase customer satisfaction,” it’s easier to understand “increase sales to current customers.” When you restate objectives in this way, it’s much easier to develop meaningful performance metrics that show you’re improving and achieving your goals.

2) The strategic objective has multiple goals. This often goes hand in hand with the weasel words problem. I can’t begin to tell you how many times I have seen the objectives of “productivity and efficiency” in the same statement. Leaving the issue of weasel words aside, how can you come up with one metric that measures both productivity and efficiency? What happens if you achieve efficiency (assuming you can define it) but not productivity? Have you succeeded? Have you failed? How will you know? Again, the solution is straightforward: One strategic objective, one goal. If there’s more than one goal, you have to create another objective. 

3) The strategic objective is not quantifiable. In my career, I’ve been faced with the daunting task of coming up with metrics for seemingly “immeasurable” problems. I used to believe that just because an objective or goal was difficult to measure, you couldn’t measure it. In the past few years I’ve changed that belief. I firmly stand by the statement that if you can’t quantify the result you want to achieve, you aren’t going to be able to measure it. What I’ve discovered is that those difficult objectives were in fact either laden with weasel words or embodied multiple concepts that were impossible to measure with a single metric. 

One way of checking if an objective is quantifiable is to ask what the end result looks like. If you can identify the end value point at which you say, “Eureka, we did it!” then you likely have a quantifiable objective. If you can’t quantify an end point, how will you ever devise a metric to show progress toward it?

So if you’re having trouble identifying meaningful performance metrics, check your strategic objectives first. Have you created fluffy objectives, laden with weasel words that sound good but have little substance? Have you tried to include multiple goals in one objective? Have you clearly identified an end result? If you answered yes to any of these questions, you need to fix the objectives. Then you’ll have a much better chance of identifying the metrics you need.

Suzanne Tucker is the comptroller for Saint John, N.B.-based Mariner Partners Inc. She wrote her MBA thesis on performance management.