Direct measures for indirect goals

Photo by Tamera ClarkLast week the nice people at Inviqa invited me to facilitate a discussion with them and a number of invited guests. Among other things we discussed how to measure value, and in particular how to measure the value of a project which brings only indirect or long term value to the organisation.

To take a specific example, suppose we were migrating the company from Lotus Notes to Gmail. We are doing in this in the belief that this will reduce our operating costs and increase our general internal effectiveness. But how should we measure the progress of our migration?

A poor measure would be “we are x% of the way through the project”. This does not surface the value delivered, and therefore does not get people thinking about how we should be delivering more value sooner. The focus is instead on completing project tasks. This is not a very Agile way of doing it.

One contributor wanted to measure progress in monetary terms: “we have delivered x% of the savings so far”. But they immediately acknowledged this didn’t seem possible, because the proposed savings were only projected, not (yet) real and not (yet) measured. I agree on both counts: it’s desirable but not realistic.

My approach is to separate value delivered by the work in progress from value ultimately sought. If we are proposing to migrate from one mail system to another then we should first be very clear that it is the right thing to do, and we might base that reason on financials. But once we start the project then value would better be based on (say) number of accounts migrated: “we have successfully migrated x% of our accounts.” This measurement will focus the team on structuring the work to deliver some value (some accounts migrated) earlier. The long term cost savings are, at this stage, an article of faith.

This kind of measurement does measure genuine value, even if it is one step removed from the overall goal. It forces us to think creatively about how to structure our work, and reporting is much more honest.

The same thing can be said of projects which are purely strategic. We may be doing a project for its long term strategic value, which can’t be measured directly day by day as the project progresses. But we can find another measure which does track genuine progress within the project itself and which will ensure we approach the problem in an incremental manner.

Thanks to all those at Inviqa for organising a stimulating evening.

Photo by Tamera Clark