Dave Gordon at his AITS.org blog deals with the issue of metrics and what makes them utilitarian, this is, “actionable.” Furthermore at his Practicing IT Project Management blog he challenges those in the IT program management community to share real life examples. The issue of measures and whether they pass the “so-what?” test in an important one, since chasing, and drawing improper conclusions from, the wrong ones are a waste of money and effort at best, and can lead one to make very bad business decisions at worst.
In line with Dave’s challenge, listed below are the types of metrics (or measures) that I often come across.
1. Measures of performance. This type of metric is characterized by actual performance against a goal for a physical or functional attribute of the system being developed. It can be measured across time as one of the axes, but the ultimate benchmark against what is being measured is against the requirement or goal. Technical performance measurements often fall into this category, though I have seen instances where these TPM is listed in its own category. I would argue that such separation is artificial.
2. Measures of progress. This type of metric is often time-based, oftentimes measured against a schedule or plan. Measurement of schedule variances in terms of time or expenditure rates against a budget often fall into this category.
3. Measures of compliance. This type of metric is one that measures systemic conditions that must be met which, if not, indicates a fatal error in the integrity of the system.
4. Measures of effectiveness. This type of metric tracks against those measures related to the operational objectives of the project, usually specified under particular conditions.
5. Measures of risk. This type of metric measures quantitatively the effects of qualitative, systemic, and inherent risk. Oftentimes qualitative and quantitative risk are separated, which is the means of identification and whether that means is recorded either indirectly or directly. But, in reality, they are measuring different aspects and causes of the same phenomenon.
6. Measures of health. This type of metric measures the relative health of a system against a set of criteria. In medicine there are a set of routine measures for biological subjects. Measures of health distinguish themselves from measures of compliance in that any variation, while indicative of a possible problem, is not necessarily fatal. Thus, a range of acceptable indicators or even some variation within the indicators can be acceptable. So while these measures may point to a system issue, borderline areas may warrant additional investigation.
In any project management system, there are often correct and incorrect ways of constructing these measures. The basis for determining whether they are correct, I think, is whether the end result metric possesses materiality and traceability to a particular tangible state or criteria. According to Dave and others, a test of a good metric is whether it is “actionable”. This is certainly a desirable characteristic, but I would suggest not a necessary one and is contained within materiality and traceability.
For example, some metrics are simply indicators, which suggest further investigation; others suggest an action when viewed in combination with others. There is no doubt that the universe of “qualitative” measures is shrinking as we have access to bigger and better data that provide us with quantification. Furthermore as stochastic and other mathematical tools develop, we will have access to more sophisticated means of measurement. But for the present there will continue to be some of these non-quantifiable measures only because, with experience, we learn that there are different dimensions in measuring the behavior of complex adaptive systems over time that are yet to be fully understood, much less measured.
I also do not mean for this to be an exhaustive list. Others that have some overlap to what I’ve listed come to mind, such as measures of efficiency (different than effectiveness and performance in some subtle ways), measures of credibility or fidelity (which has some overlap with measures of compliance and health, but really points to a measurement of measures), and measures of learning or adaptation, among others.