How to Set Target Thresholds When Measuring Quality

 

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To increase or maintain high levels of quality, organizations must set targets and performance thresholds at which corrective action must be taken. This article explains several tactics organizations employ to set target ranges for quality measures.

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APQC hears from many

APQC hears from many organizations that face challenges with using effective measures and setting sound performance targets. Some organizations find that using analytics can help establish targets that work. Others know that developing a good communication strategy helps build staff buy-in for their targets.

Over the years, APQC has uncovered leading edge best practices in performance measurement. Please feel free to contact us to learn more about past and future research in this area.

 

Chris Gardner
APQC – www.apqc.org
713-685-4717 (o)

Trish and David, First thanks

Trish and David,

First thanks for your comments. We love it when our users provide us feedback on the content items we post to our knowledge base. That's one tool we use to provide better content.

I appreciate your perspective on this issue, for sure. The white paper you are commenting on is a compilation of content from some of our recent research in the area of corporate performance measurement, and we have seen organizations having success using methods similar to the broad MBO approach. Some are pretty pure in their MBO approach, while others do bring regular adjustments and variability into their measurement, monitoring, and business planning approach.

Our goal is to show our members the methods and techniques that are being successfully employed in organizations. We would absolutely love to showcase via a case study or white paper some of the results organizations are achieving through "managing variation". If you happen to have any organizations you'd suggest, please pass them my way; we'd love to see if we can take them through our case study process. Obviously, we'll make sure and check out Dr. Wheeler's book, as well. Thanks for bringing it to our attention in such an applicable setting.

Happy Improvement!

 

Ron Webb
APQC

David, Couldn’t agree with

David,
Couldn’t agree with you more. I cringed when I read the arbitrary but very popular “5 to 10%” as an indicator of anything meaningful. Donald Wheeler’s book "Understanding Variation – The Key to Managing Chaos" depicts the major flaws associated with picking these arbitrary percent variation changes to base targets on or even using them as indicators that process performance has changed.

This article is a reasonable

This article is a reasonable review of how some big organizations are setting quality targets. It's depressing to me, though, because it illustrates how widespread the "Management by Objectives" model is. I recommend to everyone who will listen Dr. Donald Wheeler's wonderful little book, "Managing Variation". In it he explains the dangers of using predictions and budgets as targets, and the reasons why selecting arbitrary numerical targets is even more dangerous. It grieves me to imagine so many large corporations distilling their potentially information-rich measurement systems down into "red-yellow-green" designations. (I'm so tempted to call them "idiot lights".) Dr. Wheeler's book is a great introduction to a simple and valid way to display and interpret measurements, and even to show progress against a target, where that is necessary and helpful.

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