In my previous blog, I talked about how ServiceNow Performance Analytics (PA) can serve as your organization's Sat Nav. If deployed effectively, PA will help steer the organization towards improved performance, leading to such desired things as happier customers and lower (or no) SLA-penalties.
Now, the catch obviously is with that little condition: 'If deployed effectively'. How does that work? Does that mean that there is an 'ineffective' way of deploying PA? There most certainly is! Let me introduce the most crucial part of improving performance: the understanding of leading and lagging indicators.
Let's start by losing some weight
When explaining the concept of leading and lagging indicators, I always use the example of losing weight. Simply, because most people can relate to it from personal experience. If you decide you want to lose weight, you will start by setting an objective, e.g. 10 pounds in 2 months time. From that point onwards, you can focus on two aspects. The first one is weighing yourself every day to see how you are doing. The second is to start exercising and watching your diet. The first one — the scale — is considered a 'lagging indicator', as it focuses on the outcome of what you did in the past. The exercising and diet ones are 'leading indicators, as they focus on input. Important difference: You can influence the leading ones, but you cannot influence the lagging indicators.
Your organization's scales
Now, back to measuring performance in your organization. Think of your organization's financial statement as a means of expressing how the organization did, last year, last quarter, etc. It focuses solely on the outcome of your activities. It will tell you exactly where you did well and where you did not do well, the way your scale tells you how much you weigh. What it doesn't tell you is: How is the organization planning to do better next year, or next quarter? A financial report is the perfect example of lagging indicators.
Back to IT reporting
Now think of your IT reporting requirements. Most, if not all, organizations that ask us: "Can you recreate this report in PA?" have not thought through what they intend to achieve with the report. Instead, it is IT's monthly equivalent of the organization's financial report, or your personal scale: it represents the outcome of your activities.
So, let's take an example, straight from IT, and let's focus on an SLA report. What does your monthly SLA report (let's assume it is monthly, let me know if it isn't) tell about your performance? Probably that you met or missed your SLA objectives. Lagging, no doubt.
So what would a leading indicator be? Well, if your objective is to 'Reduce time spent on incident resolution', one of your leading indicators would probably be: 'Percentage of open incidents not updated for 5 days'. If this percentage goes up during the month, the chances of you missing your target by the end of the month will increase.
Keeping an eye on your incidents not updated if you want to reduce time spent on incident resolution, is like keeping an eye on your calories intake if you want to lose weight!
So: just Leading Indicators then?
Are lagging indicators useless? Not at all. They will tell you whether you achieved your objectives. The thing is: by the time they will tell you, it's too late to do anything about it. In other words: by the time you find out you didn't lose your 10 pounds after 2 months, you wish you would have focused on dieting and exercising while you could still impact the outcome.
That is what I mean by: if deployed effectively. If your goal is to improve your performance, focus on daily measurement of leading indicators. They will tell you what to do (instead of where you went wrong) so you can influence the outcome of your activities!
Please visit us at Knowledge14, where we can explore which indicators will lead you towards an improved performance.
