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Metrics Part 3: Three "Free" Metrics

Updated: Jun 27

By Hillel Glazer - CEO, Entinex -

- Time

- Quality

- Money

Whoever heard of selling metrics? How can metrics be “free” if they’re “for sale?” Well, I’m not selling metrics. I’m also not giving them away for free. Time, Quality, and Money metrics are “free” because they are ubiquitous in any operation.

Making them costs nothing and getting them should cost nothing. What you do with them could cost nothing, but if you’re not using them—or not using them effectively—it could be costing you more than you know.

It should go without saying, nonetheless, many of us know of too many instances of business who do a poor job of measuring, monitoring, and taking action on money-related metrics. This doesn’t even get into discussions about whether money-related actions are the “right” move, and we won’t get into that here, either.

I will, however, put a bit of attention on some aspects of money that more than a few businesses overlook. Many of them are mentioned in an earlier post here:

In particular, money metrics related to internal costs are conspicuously absent from many financial analyses. Even more specifically, effort is missing.

Many businesses merely count the wages or salaries of people doing the work, chalk that up to COGS, and move on. This is dreadfully shortsighted.

This is also where the other two “free” metrics come in.

What’s the “cost” of poor quality? What’s the ROI from a modest investment in improved quality?

Looking for low-hanging quality measures? Try these:

- Customer complaints, returns, or warranty claims.

- Defects or other errors found prior to delivery.

- Unanticipated work rightfully due to customers.

- Misunderstandings that don’t go your way.

- Exceptions to standard processes or repeating prior processes.

- Non-standard or unplanned work taking place to correct for any of the above.

Each of these are “lagging indicators”—which doesn’t make them bad. Each field or industry will have their own sets of distinctive quality indicators. It should, however, be an objective to identify and leverage “leading indicators” whenever practical. Knowing the conditions that lead to quality problems goes a lot farther to prevent them than merely knowing—statistically perhaps—that you’re going to have them.

One client was able to prevent quality problems downstream by putting more time into understanding how their customers were using their products. Another client prevented quality problems by reigning in salespeople’s unrealistic date commitments. In both cases, data from customer “complaints” (or loss of business or similar repercussions) were instrumental in helping to make the case for modifying processes, policies, or behaviors.

In all of these there’s an impact on actual costs of the operation. Any financial analysis without these details is foolhardy in its ability to provide a true sense of business health.

What about time?

Time is the one constant (not variable, really) that is truly everywhere and relentless. And while everyone knows the phrase, “time is money.” Mostly it’s used in economic analyses and in motivating salespeople to keep at it. In many cases time is seen as a constraint or “the enemy.” There’s never enough and we always seem to be racing against it.

But what if we can use time as a competitive advantage? What would that look like? More on that later.

For now, let’s look at some time-specific measures that are universal:

- How much time is work that’s been started sitting around, not being worked on?

- How much time is spent on work that was once declared “complete” but later found lacking?

- How many times has a parcel of work repeated a particular step?

- How much time do particular steps take?

- How much time is spent getting approvals for decisions?

- How much time is spent moving work from one place to another?

- How much time was put into work that was eventually scrapped?

This list could go on for a while, so hopefully you get the idea. But with each and every one of these measures, we can also ask,

- What’s the range of times?

- What connections are there between these measures and quality on the same parcel of work?

- What are the influences on these measures?

- Are there patterns in the outputs?

Again, this list is only limited by whatever imagination we apply to learning more about the behaviors of the operation.

So what about that notion of using time as a competitive advantage? Let’s just say that this is better discussed in person, but for the time being I’ll leave you with this: Time, Quality, and Money are inextricably intertwined. Work that takes less time invariably costs less. To cost less and take less time it must be of high quality. For quality to remain high there must be investments. For the investments to be worthwhile they must improve (by shortening) the amount of time the work takes.

A business could do far worse than to measure every decision by its influence on time. Even if the payoff isn’t immediate. Understanding the short-term and long-term impacts of how much time (effort) goes into the work is insightful business intelligence just sitting around waiting to be leveraged. Free.

Allow me to challenge you with this: Find me a measure that trumps time. Send them to We might enjoy a good debate over a mug.


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