An effective set of measures that capture
- Progress at the right granularity
- Performance of work streams
- Challenges to progress
Measures should be easy to capture, quantify, and report (automatically ideally). Measures should be captured as OKRs (Objectives & Key Results). KPIs (Key Performance indicators) and KQIs (Key Quality Indicators) can also be used.
Transformation promises a lot. There is often a significant level of investment need for digital transformation which will have business cases with agreed returns on investment agreed. Stakeholders need to understand if it is, or is going to, delivery on those promises.
Good measures provide transparency and clarity on the progress and deliverables promised. They can build trust & confidence in the vision, while making it easy for teams to understand where their focus should be.
While all Resources, Values & Processes need to be measured the focus should be on Values & processes. When new process successfully deliver new customer value we know that the resources are adapting their way of working successfully. When decisions are being made in line with the new Values this proves an acceptance of new behaviours & new approaches to decision making.
If a simplistic set of key performance indicators or KPIs are selected and then reported on manually. This gives a false impression of progress (and therefore success) of the digital transformation. This does not allow senior managers and stakeholders to fully understand what is happening, where successes are and where obstacles lie.
We should also be looking to automate the reporting of those indicators. If we are reporting these manually, there is a problem. We are not transforming; we are just repeating previous working patterns.
Go Beyond KPIs with OKRs
Objective & Key Results is a collaborative approach to goal setting to be used by both the teams and individuals. First set ambitious goals (Objectives) and for each identify the 3-5 key results that need to be achieved to prove the objective has been reached. This allows tracking of progress, alignment, and engagement around those goals.