The Lean Book of Lean

6 Measuring the Right Stuff and Metrics

As promised in Chapter 2 when we introduced the core concepts, we've now returned to the measures. Most people understand the importance of measuring performance; indeed, we are brought up from a very tender age to understand this from winning games and passing school exams, through to your annual performance assessment. We have measures and statistics thrown at us in a constant barrage every day. In most companies I've worked in, the list of “KPIs” can be over a hundred, and that's not going down to the lowest level of operation. The reason I put “KPIs” in quotes is that the “K” means Key, so if one hundred are just the “Key” ones, just imagine how many of the “non-Key” ones there must be. Do we really need so many? Are we sure we are measuring the right things? Well, in my experience, the reason for the former is to try to make sure we do the latter, on the basis that if you measure everything, somewhere in all that you'll be measuring the right things. Before we dive into what the right things are, let's take a quick look at why we need to measure in the first place – what is it we are trying to do?

There are really only two answers to this:

• Firstly, it's to find out if we are performing to some target we set for ourselves or someone else set for us.
• Secondly, it's to try to encourage somebody or a group of people to behave in a particular and/or consistent way.

There is another class of measure, which is not a measure at all really; ...