Metrics provide the most fundamental connections between the business strategy, the execution, and the overall value creation. The changing dynamics and the competitive nature of businesses have placed great demands on the traditionally known metric systems thus creating tension for most firms and the supply chains. Moreover, studies have not managed to keep pace with the environment in which the metrics are quickly evolving. People who are enthusiastic about doing businesses or running companies should learn how to proactively design and manage the metrics. This paper intends to discuss some of the most fundamental metrics for the operation managers. Picking on triple bottom line and customer satisfaction as the metrics, the paper focuses on how each one of them supports the financial performance of the organization, what is used to support the metric and how the operations manager would ensure that the data used is of quality. Finally, the paper looks into how the data analytics supports the chosen metrics.
Triple Bottom Line
With the growing need of the environmental sustainability in the business world, most organizations are compelled to first access the environmental impact before making decisions. Triple bottom line metric focuses on how to balance the economy, environment, and equity (Slaper& Hall, 2011). Also known as the three pillars, it serves as a sustainability metrics which measures the general failure or success of the efforts put on sustainability.
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Triple bottom line metric supports the financial performance of an organization in many ways. The additional environmental and social responsibility adds to the organization's financial bottom line. According to Slaper & Hall (2011), most people are willing to pay more for sustainable goods and to get associated with companies which show commitment to the social values. Additionally, companies are transforming environmental and social standards with the corporate governance policies which help in reducing the chances of brand-damaging or missteps. Triple Bottom line is also seen as a key factor in building brands and goodwill which generally represent 30% averagely the values of companies (Slaper & Hall, 2011).
Using an example of a commercial building which is designed and operated with an aim of sustainability, the balance between environment, economy, and equity are important for the goal to be realized. When the elements of the metrics are incorporated during the design and construction phases, the outcome would bring economic benefits and equity. For example, by putting the building where it is fiscally efficient there would be lower rents for commercial and residential tenants. Together with locating the building close to services such as restaurants, stores, and schools, there would be diverse demographics in terms of social and economic features and thus provide a social equity.
Scientific data can be used to support this metric. To ensure quality, surveys and observation can be used. For example, before designing or putting up a commercial building, it is important to survey the area to find out if it is fiscally efficient and if it adheres to the elements of the metric. If for example the area is located close to the social amenities like schools, hospitals, restaurants, and stores, then the organization would proceed with the construction. Quality data can be ensured by conducting the feasibility study and doing the actual survey. The findings can be used to identify problems and even set goals.
Customer Satisfaction
Another important metric is customer satisfaction. Since all businesses derive profits from their customers, it is important to measure customer satisfaction to ascertain if there would be more profit or loss. Besides knowing how the company is trending both externally and internally, measuring customer satisfaction would enable the organization to identify customer preferences and areas which require more attention (Kumar, 2016). This metric is useful in dealing with gaps in any organization.
Perception data would be useful in supporting this metric. This can be collected using questionnaires or conducting an interview with customers. This way, the customers are allowed to address their areas of dissatisfaction and indicate successful areas. The findings can be used in problem analysis, process improvement, recognition and goal setting.
References
Kumar, V. (2016). Introduction: Is customer satisfaction (ir) relevant as a metric?. Journal of Marketing , 80 (5), 108-109.
Slaper, T. F., & Hall, T. J. (2011). The triple bottom line: What is it and how does it work. Indiana business review , 86 (1), 4-8.
