What is the Purpose of Performance Measures for a Strategic Plan?
Ready to wrap up the strategic plan and move on to executing it? Well to quote Lee Corso, “Not so fast.” Performance Measures are a critical component of the plan. Performance measures are the guide poles to the race. They tell you if you are still on course. Typically we break these into short-term and long-term performance measures. Short-term performance measures look at things that will happen over the next 12 months whereas long-term performance measures look at the next 3-5 years. The long-term section should balance milestones and goals Milestones look at when you need to have something accomplished, and goals are your attainable aspirations. If you are designing the newest widget, your milestone may be a prototype by x date, and your goal may be to sell 10,000 of them per year once they launch. This section should cover both as you’ll need to hit your milestone markers to continue on a successful path. You also need a measuring tool (goals) to tell you if you’re succeeding. One thing to keep in mind with goals is who writes them. We have worked with many people that like to set goals that can simply be tripped over whereas we like aspirational goals that will be difficult to reach. That way, even if we miss we’ll be quite successful. There is obviously a middle ground here of realistic, but not easy to reach. Just make sure you understand who developed the goals and their approach to things.
Short Term Performance Measures
How do we look at short-term performance measures? Typically these are drawn up to be simple things that need to immediately happen to ensure the long-term performance/success of the organization. In simple terms, if your long-term goal is to get 1,000 followers on Instagram, then setting up an Instagram account and developing an engagement plan for Instagram is probably pretty important. Sometimes short-term performance measures are more goal-oriented, for instance, you need to raise $500,000 before the end of the year to stay open/keep going. Keep in mind that oftentimes these measures are as simple as building the foundation.
Long Term Performance Measures
Long Term performance measures are often more goal-oriented but can mix in milestones as well. This is a great place to pull in the benchmarking that was done during the planning process. Utilizing benchmarks as a basis for how you’ve come to the conclusion will only strengthen your organization and the approach that you take. In general, we suggest 1-2 goals per planning section, meaning you should have 1-2 goals coming from your communications plan, sales/fundraising plan, operations plan, and staffing plan, respectively. Too many goals and they become watered down, too few, and you probably are not looking broad enough at your organization.
Pro Tip: When developing goals, make sure they are metrics based. Saying we want satisfied customers doesn’t really mean anything, saying we want a customer satisfaction score of at least 90% on an annual survey makes it clear what you are striving to achieve.
It’s important to remember that no matter the organization, even when goals are set realistically, not every goal will be met. Using the information of why we didn’t reach a goal can be very important. Did we not push sponsorships enough to reach our sponsorship goal? Did the public not react to our product line the way we thought they would. How we utilize this information informs our future success. To quote Nelson Mandela, “I never lose, I either win or learn.”
Developing a strong, reliable set of milestones and goals is critical to performance measurement and an organization’s success.
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For help in understanding how to build your performance measurement and your overall strategic planning process contact the experts at NMBL Strategies today.
