“Measure” is a mantra that we all know. It’s the name of your current financial plan. A less well-known term is “measure”–“measurement of what you want,” says Manbir Dhillon, director of insurance training and development for MetLife.
Dhillon presents educational training sessions to cover the track throughout a career, from figuring out how much to start with to the importance of examining individual goals throughout a career.
One of the biggest examples of measurement in a work environment is making real-world decisions. You might want to buy a new car, not because the emotional tug of nostalgia stops you from doing so, but because the benefits of owning that vehicle bring you meaning, impact or satisfaction. How much more loyalty do you want to show to a current car owner and how much are you willing to spend to get it?
“The purchase of a new car or a home is a singular example of the decision-making process,” says Dhillon. “The same exact rules apply in this scenario: how much are you willing to spend, and what value do you seek from each? Which of the choices will the business make better, more cost-efficient and which will be the ones that maintain or lose value in the future?”
Most executives can cite a past decision that was used to make others understand their thinking. A well-thought-out decision can be a useful tool to communicate to others, which is important when communicating to employees or members of an organization’s greater stakeholders.
Another example is the iterative and data-driven process that develops new product designs. Because many products include iterative enhancements to the original design, and no one product can be done once, the strategy often involves having multiple, parallel plans for different elements of a product being developed in parallel. The tested aspects of the product, combined with actual customer responses to those parts of the product, are used to evaluate the initial design, which will then lead to further testing, which can lead to prototype production. By proving out the concept, certain specifications and design standards that had to be met became well-established for other elements of the next stage of product development.
Dhillon says these decisions can be challenging because people often confuse an internal decision that they make with a business decision, which has an impact beyond their immediate scope. The right strategy that’s supported by an objective measurement plan can help people make an investment that is well aligned with their core values and is motivated by a goal that’s truly meaningful to them.
“You will never know exactly how much you will need to buy if you haven’t measured the data, but that’s because you’re not a banker,” says Dhillon. “Someone with a business degree might think the amount of capital you need to invest in a new plant will work out for everyone. But a banker can see that you could have done more [tendering] and if you had more capital you might have seen a different way around it. A bank can offer advice on when and how to raise the capital.”