This is one of life’s fundamental facts. If we measure, monitor, track or try to control something, it will get better. BUT….. if we are measuring the wrong thing, it can often result in an unexpected result somewhere else.
Early on in my career, I was a management accountant for a commercial bakery. We started to realise that the waste being created by the doughnut line was creeping up. So, we started to monitor it by shift and by product line. Sure enough, after a few weeks, the waste started to go down again, and we all patted ourselves on the back for having spotted it and corrected the issue.
However, a few weeks after that, we started to see an increase in customer returns and complaints, regarding doughnuts! What on earth was going on? Well, because the teams on the doughnut line knew we were monitoring the waste created, they stopped throwing the poor quality product away, and started packing it instead. Therefore, the customers were receiving poor quality product.
What was the lesson we learned here? We were monitoring the WRONG thing. What we should have been doing is monitoring the type of issue that was creating the waste, and why there was so much poor quality product coming off the line. I actually forget what the real reason was, but it could have been the oil temperature was too high, resulting in burnt doughnuts; or the jam machine wasn’t functioning correctly, meaning that the jam wasn’t being inserted properly; or any number of other issues in a commercial production line.
This was one of my very early lessons in how important it is to measure the RIGHT thing, and how measuring the WRONG thing can result in a failure somewhere else in the process. I have used this lesson throughout my career, and now help other businesses to identify what the right things are to measure and track. This is the basis of creating a KPI dashboard for my clients, so they can quickly and clearly see if there are any fundamental issues in their processes.
If this sounds like something I could help you with, then please get in touch. I am happy to have a phone or zoom chat to discuss your requirements and to see if I can help you.