Milestones Do Not Make Meaningful Performance Measures

October 5, 2009 by Stacey Barr

“Complete business process review by June 2010” and “Implement customer relationship management system by December 2009” and “New workplace safety policy in place” are NOT performance measures, despite how often they appear as such in business and strategic plans and despite what many performance measure practitioners and experts might say.

They’re not performance measures because they fail a few essential tests of what makes a meaningful performance measure.

1. Milestones are about action, but measures are about results.

Meaningful performance measures track business results, because achievement of business results is what defines performance. Completing a task or activity, such as reaching a milestone, doesn’t define performance. Just think of all the examples in your own business or organisation where projects or initiatives or actions have actually worsened performance! That’s why milestones aren’t meaningful measures.

2. Milestones are hypotheses, not proof.

A milestone is a point in time when a particular project has reached an important stage that indicates it’s progressing as planned. Projects, and their milestones, are our best guesses (hopefully informed guesses) about what’s going to improve business performance. Not all projects succeed in this quest, and that’s because we don’t know what’s going to work until we try it out and learn from it. Milestones need measures to test if they’re working or not. That’s why milestones can’t themselves be meaningful measures.

3. Milestones are too little, too late.

You reach a milestone or you don’t. It’s that simple. If you use milestones as measures, then you’re really saying if we don’t meet it, we’ve failed. But that’s too trivial, and it also drives the wrong behaviour (people fiddling with the project schedule or scope, rather than making sure the project is making the improvements in business performance it was designed to). With continuous feedback that meaningful measures can give us over time, we can easily adjust our projects and activities as and when we learn what works and what doesn’t. That’s why milestones aren’t meaningful measures.

Are you convinced that milestones aren’t measures?

Where ever you have milestones in place of measures, you very likely need to go back to your intended results. What improvement are you trying to achieve? What difference are you trying to make? Why does reaching this milestone matter? Then focus on finding measures to track those results, through time, as feedback on how well your projects (and their milestones) are working in bringing those results into reality.

TAKING ACTION:

Look over your own business or strategic plan and check if you’re using milestones where measures need to be. If you are, a great way to find a meaningful measure is to ask “What result do we want from successfully reaching this milestone?” And then develop a measure for that result.

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  1. Gary says:

    Stacey – I agree that the examples you give in the first paragraph of your article are not measures – they are more like objectives. However, I'm not quite on board with your 'essential tests' related to milestones. In my organisation, the delivery of projects is a critical element of our performance, and therefore milestone measurement is an essential indicator. Measuring just the 'result' of the project – which would typically be delivery on time, within budget and with a satisfied customer is important but could be argued is too late. It is equally important for us to measure not just the result, but those things that drive and influence those results. Therefore, it is key that we have both an advanced warning system for milestones of the project along the way, and also an indicator of our generic ability to forecast and achieve our targets over time to drive improvement in this area. Hope this is useful feedback and thanks for your useful articles!

  2. Boago J says:

    Hits the nail on the head. I am quite new to this measurement business. For quite some time we have focused on milestones as results indicators and celebrated completion of activities as success. To an extent we still do. The result is that as individuals and objective management teams we excel while the institution underperforms.

  3. Dan says:

    Stacy,
    Agree with you for sure albeit depending on the business area you are looking at it could be a measure of their performance around projects. Percent of milestones met or early for example for the project managers once you drill through to thier contribution to the organizations goals. May still be a lower level measure related to the actual outcomes desired using the balanced scorecard approach.

  4. Stacey says:

    Awesome comments, guys!

    I agree that the only time you'd measure milestone acheivement is when you're actually measuring % of milestones acheived (or something like it) over a whole range of projects or initiatives, and this performance measure would be a measure on how well the organisation manages to keep projects on track. Yes, this would be a driver of higher level, business related outcomes. But a standalone milestone is not a measure of anything. Great to have you all comment on this. Thanks!

  5. Anonymous says:

    hi…Stacey,

    Pls tell me more abt standalone milestone..

    thank.

  6. clifford777 says:

    Balanced scorecard suffers many of the same problems as many composite measures. It simply means we are mixing different kinds of things. The conversion weights between those things tend to be somewhat arbitrary. Suppose your card has 4 categories with 4 different measures. 3 of categories may be up and looking good, the 4th might be a disaster.
    By most weighting the over composite measure yields the organization might look like it doing ok. but is it? one could take the overall measure to be the weakest of the 4 categories but that approach has troubles too. Another difficulty is that categories are not necessarily different, customer, financial, learning, and processes are not necessarily independent features. After all, it seems to me that happy customers ought to have big impact long term on financial results, and processes, got to impact customer and financial, and so on. A better way to look at this is to see some factors as "results" and other factors as "causal". We can control the causal factors, but the results factors are not directly controllable. This approach of separating casual and results factors is what one finds in Design of Experiments in the field of statistics.

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