The Value of Quantitative Metrics
In recent years the sports world has been dominated by quantitative analysis. In baseball, for example, advanced metrics and the Moneyball approach are incredibly popular as teams compete to find the big name. The development of new ways of measuring and understanding player performance have transformed the game, and we’ve seen similar changes in other sports. This approach has truly revolutionized recruitment and player development, and has opened up professional level sports to a whole different type of athlete – recruiting moved beyond simply looking at batting average or ERA to more advanced metrics of performance. A similar shift has occurred in the business world with KPIs, quantitative analytics, and big data becoming increasingly important. In this article I discuss some changes in business performance measurement and how businesses can get a better understanding of team and individual performance.
Advanced Metrics and Business
There is significant value in measuring and understanding performance in quantitative terms: you get a consistent and comparable measure that allows you to see performance over time or in particular contexts. For this reason it is important for business managers, like baseball managers, to measure team performance quantitatively. Applying quantitative analysis in a manufacturing or production setting is fairly straightforward: throughput, capacity, job time, etc. There are many Key Performance Indicators (KPIs) that manufacturers can measure on to understand individual and team performance. This approach isn’t limited to manufacturing settings, however, and service-oriented businesses can utilize quantitative metrics to improve team performance in similar ways. Understanding your team quantitatively helps leaders make smart strategic decisions.
There are many software systems available to help businesses measure performance and improve decision making. These tools can automate the process for you and provide you with an easy to understand and interpret output that can be graphed, charted, or otherwise visually presented. Even without these tools, businesses can develop their own tracking systems in Excel.
Balancing Quantitative and Qualitative:
Although I am a big advocate for quantitative analysis in both sports and business, it’s important to keep the big picture in perspective. Many times I’ve seen people become too focused or obsessed in the numbers, or measuring impact at a micro level. It’s important to look at individual and team performance in the bigger perspective and to also look at qualitative metrics – those things that can’t be measured numerically but have an impact on team performance otherwise. To return to my sport analogy, many times players will have a smaller quantitative impact but are considered an important “locker room guy” – they’re big for team chemistry. This type of impact isn’t measurable in a quantitative sense but it can definitely play an important role in overall team performance.
It’s also important to recognize the limits of these measures – an individual and a team cannot only be measured quantitatively and there are so many important things to understand behind the metrics such was what operational or environmental conditions are impacting performance. It’s also important to look at these metrics within a context – if there’s a sudden spike or drop off is this consistent with their overall performance or an outlier? Ultimately, numbers are important but they don’t tell the whole story. This is why it’s important for business leaders to keep sight of the big picture and using quantitative metrics to support decision making.
How Does Mentor Works help Businesses Understand their Teams
Businesses who are interested in improving their measurement systems can benefit from Mentor Works’ services. We have assisted numerous businesses who are in the process of identifying productivity gaps, metrics for analysis, and implementing measuring systems find the funding they need to complete projects. Businesses can obtain Canadian government funding for these types of projects, and Mentor Works’ government funding experts can help you develop the project you need to improve your measuring systems. Whether it’s through external management consulting, software implementation, or team training, funding is available to reduce project time and improve outcomes.
If you’re interested in learning more about the value of KPI measurement and opportunities available to support your project contact us to get in touch with a government funding expert today. You can also register for one of our free funding workshops or webinars to learn more about other funding opportunities. Follow me on Twitter and LinkedIn to keep up to date with Mentor Works.