From Vision to Value: The BA’s Guide to Conquering Transformation. (Final part)

Here goes the end of the trilogy, the final part of our series — from vision to value. Sadly, this beautiful series ends here, but not to worry, there will be other insightful articles coming up.

If you missed the first two parts, where we talked about process improvement, business requirements and knowing the vision of your project, you can catch up here and here.

For this part, we’re going to be focused on am important aspect of the journey from vision to value — value measurement. How do you measure the success of your transformation efforts?

That’s the question we seek to answer in this article. Without further ado, let’s dive right in!

Introduction

You must have heard the saying, what you measure is what you get. The goal for any business transformation initiative is to achieve its objective and ultimately deliver on its promise — adding value to the clients and users and the organization as a whole.

But see, delivering value can sometimes be a bit of a nebulous concept, especially when we talk about value in a non-tangible sense, such as reputation. So in order for you to understand if you’re scoring goals and delivering on your promise with stakeholders, you need some goal posts.

This is where critical success factors (CSFs) and key performance indicators (KPIs), come in. Let’s call these transformation performance objectives. They help you draw the pitch, the scoring lines, and the goalposts, and determine if you are achieving these objectives just on track or perhaps underperforming on your promise.

What I have learned as a business analyst is that as much as projects need a strong strategic vision and a solid promise to move people to action, we also need metrics and performance indicators connected to the vision as this gives us the actual proof that we are scoring and delivering value.

So first, let’s pause and get on the same page about CSFs and KPIs. CSFs or critical success factors are vital elements for business transformation. They’re derived from the project’s mission and objectives. Achieving these factors means that you are successful. KPIs or key performance indicators are measurements that help us understand how well we are progressing towards our goals and our promise. They also need to be smart(specific, measurable, attainable, relevant, and time bound).

These terms are sometimes used interchangeably, but that’s wrong. They’re actually very different, but they’re also linked. Let me show you. Let’s look at an example such as delivering any project successfully.

So here are the five typical critical success factors:

• Clear project objective,
• executive support for the initiative,
• stakeholder involvement,
• project management expertise,
• and stakeholder buy-in.

Once we have the critical success factors, you use them to define specific KPIs. These are data points that enable a project or an organization to decide whether CSFs have been met. For our project example, this will be things like the:

- percentage of employees who clearly get the project objective,
- number of executives supporting the transformation,
- percentage of stakeholders dedicated to the project initiative,
- percentage of employees dedicated to their initiative with project management skills,
- percentage of stakeholders who support the transformation.

Now you know the process and the steps involved, you can help develop your project’s critical success factors and KPIs. And why are we doing any of this? To demonstrate clearly that the business transformation is delivering value.

So define your CSFs. Use your KPIs. You measure that it’s working. You measure that it’s progressing. And you measure that the organization is truly transforming.

Now that we understand how Critical success factors and Key performance indicators come together to give us an idea of our project’s success, we then look at another important tool for measuring project success.

Balanced business scorecard for performance management

Various performance frameworks have been developed to help entities focus on the factors that drive successful attainment of goals and corresponding performance measures. One such framework is the balanced scorecard, developed by Robert Kaplan and David Norton.

The balanced scorecard provides a set of performance measures that reflect an entity’s goals and strategies. The framework includes measures from four perspectives.

1. Financial. How do we create value for our shareholders?

2. Customer. What do new and existing customers value from us?

3. Internal operations. What processes must we excel at to achieve our financial and customer objectives?

4. Innovation and improvement activities. How can we continue to improve and create value?

The balanced scorecard framework implies that traditional financial performance measures are inadequate to capture the entire performance of the entity alone. There is a need to include both short-term and long-term measures, as well as financial and non-financial measures.

Now, the idea of the card is that we need to present measures to gauge how well we are tracking, but if we only focus on, let’s say, the operational side, and we measure turnover, time, and defects, we may not understand the customer’s needs and wants. Equally, if we’re focused on customers only, the resulting measures may not give us much in terms of internal capability, learning and growth. So with the balance business scorecard, you create a view with a balance presentation of financial, operational, customer, and innovation measures.

An example of forming a balanced business scorecard

Now that we know what a balanced business scorecard is, let’s see how we can use one. Let’s take a HR tech implementation as an example. You’re working as part of a team to implement a new HR tech, something similar to Workday.

There’s an outdated HR system, so your team is responsible for scoping the new tech and building the requirements. Imagine you are already assigned to the project to start requirement elicitation.

Before we start, we need to know what we’re solving for and how well we need to do. We need to draw our goalposts. So to recap the four areas or legs that we need to look at. They are financial, operational, customer, and innovation. So finance leg, let’s say the financial goal for the project is for HR to be achieving cost efficiency. The goal of the system is to reduce costs and improve return on investment. And here we start to add the actual measures, things such as HR expense per employee, and HR expense as a percentage of the overall organizational expenses. Let’s look at operational.

So, again, here we look at the internal business processes side. The goal for our example project is to improve the employee experience and HR process efficiency, removing roadblocks, double handling, and the outdated processes. But what does this mean in measures? Well, it’s things like number of HR process issues per month and number of HR requests that have exceeded the service level agreement targets.

Next is customer. The main functions of a new HR tech are to meet customer needs more effectively and to increase customer satisfaction. For the example we’re working on, our customers are our internal employees. So what should we measure? Well, it’s things like internal employee satisfaction score, number of employee complaints for HR processes.

Lastly, innovation, or learning and growth, the employee’s ability to scale up knowledge and skills. Part of the project is to teach employees how to use the new HR system. So we are measuring things such as number of Workday tickets logged and number of closed Workday tickets.

So while the voice of the customer is important, this scorecard will help us to view performance in several areas simultaneously. That’s what makes it balanced, that’s what makes it great and that’s what makes it objective for you and for your stakeholders.

If you’re assigned to a business transformation initiative and there is no mention of this tool, then do one of your own. Show it to the team. Show them the benefits. Show them that the outcomes are directly correlated to the promise the business transformation will deliver. You will gain points not only with stakeholders but with your own product and delivery teams too, ensuring a balanced view, highlighting the most pressing challenges are front and center.

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Thanks for reading this far, I believe you now understand how to measure the success of you project efforts using the three tools we looked into — the Critical success factors, Key performance indicators and the balanced scorecards.

This isn’t goodbye, see you in the next medium post.