Higher Number the Better

The higher the number the better, right…?

We are quite often asked for input by our customers in defining and shaping their performance objectives for managers.

One of the most common mistakes I see is the notion that a higher level of performance is always better.

Not all metrics work this way though and it can show a lack of understanding of the data you are trying to improve. Let me give you an example.

In a call centre, a target might include meeting a Service Level or Grade of Service of 80% of customer calls answered in 20 seconds. The performance objective might then set in the following way:

  • Less than 80% – below expectations
  • 80% – met expectations
  • 85% – exceeds expectations
  • 90% – high performance
  • 95% – outstanding performance

Sounds reasonable, right? So what’s the problem here exactly…?

The problem is that bigger isn’t always better. In this case, the higher the Grade of Service, the more staff you need. You get a diminishing return on investment where you are spending a lot of extra money on resources to get a few more percentage points of service level.

If this managers’ performance appraisal included something about being efficient or keeping under budget – then the Grade of Service objective will be directly at odds with this.

It’s rare that an organisation would need to target a level of service so aggressively. I can think of a few examples, such as an emergency services response line (think 911 in the USA or 999 in the UK).

So what’s the alternative? If you really want to drive high performance for service (speed) metrics like Grade of Service, try targeting an effective range. Something like this:

  • Less than 65% or greater than 95% – below expectations
  • Between 70% and 90% – met expectations
  • Between 72.5% and 87.5% – exceeds expectations
  • Between 75% and 85% – high performance
  • Between 77.5 and 82.5% – outstanding performance

And if you really want to set a challenge – tighten up the reporting timescale. So instead of setting these targets for a Quarter or a Month, try achieving them each week, or each day. Eliminating variation in performance is far more difficult and a better indicator of performance excellence.

You could also target the 20% of customers that miss the 20-second call answer threshold with things like maximum waiting time or a second threshold. Or take a higher level of service in a longer time frame, such as 95% in 120 seconds. Again, the trick here is consistency, not a higher number.

Bigger isn’t always better.