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How to create output targets

creating-targets Creating targets for a process construct - Blog Article

In the words of Peter Drucker: "you can't manage what you can't measure." In my blog article "The difference between a target, an output, and an outcome", I explain the complexity of targets, and the distinct types of targets. In this post I work with process output targets only.

The first question that we must answer when creating a target is how to find one. In orgamatics™, we draw all our operational targets from a process construct™. The only way to know whether a process is producing efficient results is through process output targets. Therefore, each process on each level of the process construct, as well as all systems within the process construct, must have quantifiable targets. Not only that, but all targets within a system must relate to each other. The units of Org™ should draw all their operational targets from a process construct. Where a unit creates a target outside the process construct, we should assume that there is a problem with the relevance of either the process construct, the target, or the unit itself.

In my posts on strategy and on the project construct™, I explain the relationship between operational and strategic targets. One should note that strategic targets often influence operational targets. Further to this, it is also important to know that the way we create operational targets differ significantly from how we create strategic targets. This brings the problem that it is hard to work with one without relating to the other, yet, even harder to combine them as one metric. So, we must work with them in a back and forth way, often adjusting more than once.

Now, an important question is: "if all targets in the construct relate to each other, where in the construct do we begin to create them?" Well, the best place to do so would be to start where we do the work, and then cascade them from bottom to top. In my post on "How to engineer a process construct" I explained how we develop a process construct from the top down, after which we create targets from the bottom up. I will explain how we cascade targets from bottom to top in my blog post "How to translate targets from bottom to top in a process construct", but first we must learn how to find them.

How to identify targets

To spot a target, we must study its purpose and process flow, and as mentioned above, we begin with frontline processes. I will, once more, use the example of the IOI's "accredit new practitioners" process. The purpose of this process is that "there is an integrated and automated process that registers and accredits compliant orgtology practitioners." From this purpose we devised the process flow below…

The process flow of a front-line process

The questions that we must now answer are: "what outputs must this process produce?" and "how will we measure them?" We do that by asking:

  1. What must this process do?
  2. How will we know that this process is performing?
  3. What is the historical performance of this process?
  4. How far can we stretch the ability of this process?

I have already answered the first question through giving the definition of the process purpose. An answer to the second question will define the targets. For this process it is that…

  • "All practitioners who goes through this process, must be compliant.
  • The system must be fully automated so that the applicant decides the speed of process flow.
  • The system must work so well that no one who uses it complains about it."

The last two questions relate to the quantification of targets. The only scientific way to quantify a target is to look for consistency in past performance and to investigate the cause of variation in such consistency. Of course, all this will depend on how well we have designed and understood our process construct. In short, if you do not have historical data to analyse, or even worse, if you have not defined a process construct, then the best that you can do is to get experienced people in a room and ask them to guess what the targets should be.

How to define and quantify targets

Now that we have found our targets, we can define and quantify them in such a way that they become benchmarks against which we can measure our results. There are five items that collectively make any target extremely measurable. I discuss each one below.

1. Definition of the target: 

How you define a target is important. In orgamatics we opt to define any operational target in a current state and not as a future state. E.g., instead of saying: "To only admit compliant orgtology practitioners into the IOI", we would rather express it as: "The IOI only admits compliant orgtology practitioners." The last definition is direct and shows an ongoing reality as opposed to a reality that does not exist yet.

2. Quantification and measure of the target: 

We allow any numeric quantification, but where possible, we prefer using percentages since we can make direct sense of anything if we take it to one hundred points. E.g., when we use a number such as "$27 009 000 in sales turnover" as a target, we do not really know whether it is high or low. But, if we say "10% increase in sales turnover", then it will make perfect sense to any person who reads it. Quantification must be numerical, because in science we can only measure outputs if we can divide it into units of something. In orgamatics, operational targets run alongside a strategic period. In other words, if the strategic period is three years, then we will estimate the capacity of our process through target chunks that run over a three-year period. In this case, we will quantify one set of targets for each of the three financial years.

3. Evidence: 

We assume that if we achieve our targets, the purpose of the process will increase in relevance. Therefore, subsistence of the purpose combined with growth of the process is evidence that we are achieving our targets for that process. If we agree that a growing purpose is evidence of target achievement, then it makes sense that the same purpose will become a target of its parent process. This is the basis for translating targets from the bottom up.

4. Point of measure: 

This is a point in time when we measure our target achievement. As mentioned, we have three quantifications for each target. I suggest that we measure each of these annual quantifications quarterly, so that one can act early enough if things go wrong.

5. Priority Weight: 

This is the importance of the target that we express as a percentage. We weigh targets to show they are not all equal when we calculate a target score. E.g., if I must do four things, which are: to wake up; have breakfast; travel to work; and do a full day's work, then I cannot claim a 75% performance rating just because I have done the first three things. If for instance "doing a full day's work" weighs 80%, and I omit to do that, then my score is only 20%.

Below is an example of how we wrote targets for the "accredit new practitioners" process.

Process targets for a front-line process

In my blog post, "How to translate operational targets from bottom to top in a process construct", I resume this discourse on targets. In that post, I show how we cascade targets upward in a process construct, until they end up as core operational targets in a strategic document.

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