4. Measuring and Reporting Flashcards
What is the goal of Management and Reporting?
To support good decision-making and continual improvement by reducing uncertainty. This is achieved by collecting relevant data and assessing it in appropriate contexts. Data can be collected on products, services, practices, value chain activities, teams, individuals, suppliers, partners, and the collective organization.
Measurement
A means of decreasing uncertainty based on one or more observations that are expressed in quantifiable units. Helps clarify the reason for direction, reduces risk in plans that consider the measurement or calculation that is monitored or reported for management and improvement.
Metrics
the data resulting from measurement that has been processed into something meaningful. A measurement or calculation that is monitored or reported for management and improvement.
Indicator
A metric that is used to assess and manage something. Important metrics associated with objectives.
Report
A detailed communication of information or knowledge about a topic or event.
Four Key Reasons to Measure
1) To Validate
2) To Influence
3) To Justify
4) To Intervene
Five Key Types of Measurement
1) Progress - degree of achievement in relation to a goal
2) Compliance - degree of adherence to a regulation
3) Effectiveness - degree of fitness for purpose
4) Efficiency - degree of fitness for use
5) Productivity - throughput of a process over a period of time.
Planning and Evaluation Model
A model used to help find meaningful metrics by connecting what is measured to the organization’s desired outcomes.
Purpose <=> Objectives <=> Indicators <=> Metrics
- Purpose - Why are we doing this? What is the core mission?
- Objectives - What would a successful result look like? What should be achieved to ensure that the desired purpose will be fulfilled? Refine the defined purpose into specifics.
- Indicators - What measurable results would indicate success? Each indicator will typically have one or more measurable element that will indicate the degree of success. Each indicator will typically have one or more metrics associated with a desired trend or target.
- Metrics - What are the numbers? Every indicator is based on one or more metrics, but not every metric contributes to an indicator.
Balanced Score Card
A framework used in planning and management to balance four different perspectives (Customers, Financial, Internal, and Innovation) that contribute to achieving the organization’s vision and mission. Metrics should be developed for each of the four perspectives without too much focus on one area. Each perspective and its relevant objectives will be supported by at least one KPI.
Characteristics of Good KPIs
- Prove whether a strategy is working
- Show the degree of performance change over time
- Focus attention on the things that matter for success
- Allow the measurement of accomplishments (not effort)
- Provide a common language for communication
- Reduce uncertainty
Organizational Improvement Cascade
Objectives at each level of the organization should support the objectives of its higher levels. Typical levels include organization, business unit, department, team, individual.
Success Factors
Describes a condition or characteristic that must be achieved for something to be considered successful. When the success factor relates to an ITIL practice, it is called a Practice Success Factor (PSF). Several success factors need to be achieved for a fully successful result.
Key Performance indicators (KPI)
Metrics that are used to indicated the fulfillment of success factors. KPIs validate the achievement of the PSF.
SMART
A model used to help define KPIs.
- Specific
- Measurable
- Achievable
- Time-bound
Watermelon Effect
A situation where all KPIs are being met (green) and the organization believes its service consumers to be satisfied, but in reality value is not actually being created and success factors are not being met (red). This often comes from time base KPIs that cause undesirable behavior to have a cosmetic effect on data.
