2. The article entitled \"Staying on Course with Strategic Metrics\" explains th

Question

2. The article entitled "Staying on Course with Strategic Metrics" explains that there are two major categories of metrics: management and strategic. Management metrics focuses on the vision and goals of the organization. Both metrics must be clear, meaningful, objective, and measurable. Destination metrics, which is a new term for me, answers the question "How will we know when we have arrived?" (Krentz, DeBoer & Preble (2006). In most companies, strategic metrics at the vision level, are reviewed annually, and goal level strategies are reviewed semiannually or annually. Management metrics at the strategy level are reviewed weekly, monthly, or quarterly. Tactical level metrics are reviewed daily, weekly, monthly, or quarterly. The section on setting targets was also interesting because you have to decide where to set your targets.

Question to be answered: If they are set too low and are easily achievable, is that target really benefiting the organization? Stretch goals should be set at a reasonable level, one that can be met with extra effort and innovation. Setting target corridors is useful because markets change and can be unpredictable. Setting a low and high target gives a range that can be accomplished.

Krentz, S., DeBoer, A., & Preble, S. (2006). Staying on course with strategic metrics. Hfm (Healthcare Financial Management), 60(5), 86-93 8p.

Explanation / Answer

The article mentions about the different types of targets and how frequently they have to be set. Different activities require different levels of frequency for keeping track of whether the company is on the right path of achieving the target or not. In this context, the question that is asked is whether setting a low and easily achievable target is really benefitting for the organization or not. In this regard, it can be said that the target should be objective and measurable. Depending on the kind of activity or the department for which the target is being set, the answer may vary. But I believe, in order to achieve a bigger target, it is essential that there are many small targets set first. If the smaller targets are achieved one by one then the company will eventually achieve the bigger target as well. Moreover, achieving smaller and easier targets will motivate the employees and it will encourage them to work for achieving the larger target as well.

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