Saturday, August 14, 2021


Select the right set of indicators of improvement and measure them effectively.

Continuous improvement means to continue to discover that "there is always a better way.”Any individual indicator can be a lead or lag indicator depending upon the context and the explanatory model chosen. 

Have always looked at a Lag Measure as the method for measuring the outcome and the Lead Measure as the bet you make. Here are three indicators for measuring improvement.

Process indicator: The breadth and depth of business management improvement or innovation include process optimization, workflow streamlining, competency development, etc. Good process results depend upon a number of things included in the learning & growth perspective. Continuous improvement is performed in collateral activities, meaning that people can step out of their daily job to perform specific improvement activities. Strong business processes have a better chance to deliver tangible results measured via leading indicators. Process management effectiveness and efficiency achieved through standardization and optimization directly impact business performance and management success.

Learning Indicator: Continuous improvement goes hand-in-hand with one of the digital principles" - to learn constantly so we continually improve. Improvement cannot be made without continuous learning. Well trained and happy staff are needed to make the processes work and make continuous improvement. Adapting learning and continuous improvement culture involves gathering data, analysis, defining areas to be improved, and a measurement scale for the improvement. The organizational learning indicators need to be “SMART” -what are the relevant metrics and how can they be quantified and validated? People can see what the outcome will look like throughout their learning journey. Second, there should be a consideration for a balanced scorecard that measures the progress of the milestones you want to achieve during the learning scenario, and keeps people focused.

Financial results as lag indicators: In any time period, when evaluating the KPIs, the financial results are seen as the result of activities in prior periods. That's why the financial KPIs are "lag indicators." The right metrics can be helpful to track progress in business improvement initiatives such as process improvement, technology update, or people improvement, etc, quantitatively; keep reviewing return on investment and varying financial related indicators of existing investment, whether the depreciated life cycle is completed or not; or whether new technologies/products mature enough in the business market to adopt; or whether employees can become growth driven, more productive or innovative, with tangible results.

Select the right set of indicators of improvement and measure them effectively. Use metrics as pointers to areas requiring further investigation. With reliable performance data, the management can guide the team to understand the purpose of doing metrics and engage in that, and fix the root causes of the problem to make continuous improvement.


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