Performance Measurement & SPC

You can’t manage what you don’t measure

Current management wisdom

Measure the meaningless and misinterpret what is measured

Current management practice

Measurement is important in industry and for the effective management of organizations. Yet for all its importance, we tend to do a spectacularly poor job of it. We measure the wrong things, misinterpret the data gathered and make bad decisions as a result. Much of this stems from a misperception as to the purpose of performance measurement. Performance measurement has but two purposes:

Improve understanding as to how, or how well, systems and/or processes are functioning.
Provide the knowledge and data required for people to take action.

Good Performance Measurement Systems . . .

Focus attention on factors critical to organizational success, as opposed to individual results.

Balance attention to outcome and in-process measures. Exclusive attention to outcomes is always a disaster.

Are tied to the organizations culture, philosophy and business model.

Evolve based on the organizational learning that comes from experience and experimentation.

Focus on the critical few as opposed to the trivial many.

Display the data in context using graphical tools to assist with communication and interpretation. This often comes down to extensive use of run & control charts