Metrics

If you are running IT services company, here are the key metrics you would need to know

Key Company level Metrics

1. Project Schedule Variance
2. Project Effort Variance
3. Project Defect density
4. Escape Defect Ratio
5. Overall Process Compliance %
6. Company level Resource Utilization
7. Revenue Per Head
8. Gross Margins, Quarter-on-Quarter
9. Net Profit, Quarter-on-Quarter
10. Bell-Curve
11. Rookie Ratio
12. Cost per Hire
13. Contractor Vs Employee %
14. Attrition
15. Average Training time per Employee
16. Average experience across all resources
17. Average experience working in the company
18. Average appraisal %, Year-on-Year
19. Bench Ratio
20. % of people promoted, Year-on-Year
21. % of revenue spent on Training & R&D
22. Revenue Projection to Actuals
23. Revenue Projection to Sales-Pipe
24. Employee Count Technology wise
25. Successor Planned %

Must required Systems

1. HRMS
2. CRM
3. Finance Systems
4. Performance Management system
5. Project management Tool
6. Security Management
7. Travel Desk
8. Intranet (Events/Policies/OrgChart/WhitePapers/Articles/etc)
9. Asset management
10. Ticketing system

PBC - Performance based culture

If someone were to ask you, what is  your organization culture? what would be your response? Organization culture relates to how majority of you behave on a day to day basis in your organization. This generally percolates from top to bottom for the simple reason that people either follow their bosses/leaders or forced to follow by virtue of power. (The one who doesn’t want to follow their bosses would eventually leave the job or ask for change in boss, provided the organization is hierarchy agnostic and promotes 360 degree feedback).

Companies like GE have high performance based culture because they are very quick to reward and reprimand people (being very candid in their feedback) and spends enormous time on acquiring and growing human capital. (Bank of America CEO Kenneth Lewis once said that if I can hire the right leaders for my company, that's about completing 99% of my job, this is so much true).  

So what should you do to build PBC? 

• You got to be extremely self disciplined
• Walk the talk
• Don’t repeat mistakes
• Show high integrity
• Let people know what they are expected to do? give them goals and track them
• Give your people candid feedback (this is not easy, you can only do this if your self performance is unquestionable, so you got to be a great performer first to build performance based culture. You can cannot ask your team to go that extra mile while you sit back)

What are the key reasons behind non performance based culture?

• One of the big reason is bosses being political in nature
• Political environment leads to favoritism 
• Favoritism leads to appraisals which are NOT performance based
• Lack of goal setting and measurement
• A poor performing boss can never give candid feedback to his/her junior - This would happen if you don't hire the right manager/boss in the first place. If a boss cannot give performance feedback how do you think people under him would perform?
• Promoting 'Duck Language' - people who keep pointing finger on others for their failure to achieve something, giving some reason or the other for failure than taking the responsibility of it. These people are often quoted to be using 'duck language', the more ducks you have in your organization the lesser the performance of your organization would be.
• Imagine a manager using duck language and he in-turn managing 20 more ducks, do you think anything will get done in these type of organization? Nothing.

I was just wondering if the Mumbai terror attack would have ever happened if the UPA government would have believed in PBC? PBC demands that every member of the organization knows what is expected out of them and how they would be measured and appraised.

Unfortunately our coastal guards never knew what their exact job was, even if they would have known it, there were no good managers to measure performance and let them know that they were doing a bad job.

One of the coastal guard ship never went on patrolling for last one year, can you believe it? here are the reasons given by a guard when asked by a journalist. 

[Journalist] Why was the patrolling not done

[Guard] The ship is not working; we have informed our higher authority

[Journalist] So what happened after the complain you raised

[Guard] I don’t know I told my boss, he hasn’t got back

[Journalist] What have you been doing for 1 year

[Guard] What Can I do, it is not in my hand. 

Guard was not willing to take any responsibility and was constantly using duck language. I just wish that our political system can be run like a private company where everybody has to perform to survive. 

Had the government measured performance of these guards using few KPIs (key performance indicators) things would have been different. Measurement like average number of petrol done per day? Number of cases reported and closed per month? Number of repaired reported and carried out by service department? Average time taken to close a service call?

Another stunning revelation, fisherman community sending letters to Mumbai state government informing about smuggling of RDX in August but absolutely no action taken regarding it. Policemen caught hold of a terrorist in February 2008 with all sketches depicting Mumbai terror plot, yet no action was taken.

Had the government had the SLA's set like every security threat reported should be acted and closed within 48 hours and the public had open access to such KPIs data, I am sure the government wouldn't have the guts to behave the way they do now and possibly this Mumbai attack would have never happened.

My First Blog

Yes finally I have started blogging, been thinking of this for sometime but never could push myself to spend sometime after office hours to do blogging. The reason I want to blog is to centralize all my knowledge and to share with others and possibly as days pass by, this would become a handy reference for myself.

At this point in time, I am thinking to blog a lot about

• Leadership 
• Performance based culture - why is it difficult to build in an organization?
• How to improve IT services 
• HR BEST practices
• Metrics everywhere - why measuring is important
• What it takes to become a CEO?
• People mgmt
• Hiring

and many more.....