Performance analysis You have interviewed an executive of a company that provides outsourced services.

What key insights can you get from the following excerpt of your interview about measuring performance? Build a counter argument from the client’s perspective.

How many metrics are you going to measure and report on to your client every month? . . . and potentially be accountable for from a financial point of view? 30? 50? In order to manage that many different services you can imagine how the SLA’s can really spin out of control and be a huge list with a whole staff just to do all the measurement on both sides. Let me give you a really simple example, a help desk. Everyone knows what a help desk is. We’ve all called a help desk for a Visa card or something like that. How many metrics can you come up with to measure how you interact with that helpdesk? A whole bunch of them. How fast do they resolve the problem? Am I happy with how they treated me? How much did it cost? How much of the information are they using that comes through the helpdesk to feed back information to improve our business processes? There are many things you could come up with to measure. For one of my most recent clients we had metrics for (and we had financial penalties if we missed, so this is serious business, often tens of thousands of euros at risk for each of these numbers every month) how many calls were resolved in five days, how many calls were resolved in 15 days, what was our caller satisfaction level, and a couple of other measures as well, just related to the help desk operations. Ideally, what you’d like to do is determine what single metric reflects the others well enough that we can just measure the one. And if we are good there, we know we are good overall. So for example, if my customer satisfaction on the helpdesk is let’s say 80% or better, do I really need to measure how long they were on hold before I answer the call? Because, if I make people wait on hold for a long time, their satisfaction is going to drop; they are unhappy. So if I just measure customer satisfaction, can I skip measuring how long they waited, or how many hung up because they waited too long? Or how many people had to wait five days before their questions were answered? If I just measure that one customer satisfaction number I don’t build a whole team to measure all those other things. If your client is smart, what they will say is: ‘If I can hold you accountable to the end metric, which in this case might be customer satisfaction, it’s not my problem about all the other stuff’. Because, if the client finds that my customer satisfaction number is dropping, I as the provider am going to be accountable to exhibit out whether it is because too many things are taking five days to solve, because too many people are waiting on hold too long, and so on. For the client as my customer it stops being ‘their problem.’ The smart solution when it comes to service quality and metrics is finding one metric for each service that reflects the client’s business need most effectively and let your operating team manage the exceptions for all the other ones. So if I get an issue, what is the root cause of it?