Managing with Variations in Measures

by : tjacowski

Though measuring results and procedures is extremely important to the proper functioning of any business, there is a problem presented by the common habit of managers to focus on only the most recent results that have been achieved, instead of patterns and trends that explain outcomes over time. There is a great deal of risk involved in centering on only on the most recent measures that have been obtained.

This risk is easy to recognize by anybody who has had to work with statistical process control, as there are always occurrences of error and sudden variation. These errors and variations are the result of having applied a measurement system to the same single item over and over and obtaining different results. Consider testing the acidity level of water, or the voltage of a wire several times in a row, and receiving different readings every time. The same goes for business management.

From improvement and quality strategies such as Six Sigma, managers and other businesspeople can learn to accept the latest measures and results only as the latest piece of a pattern or trend. This allows them to determine the true successes and failures in their business, and put emphasis upon what needs to be done in the future to match or improve upon the effectiveness of their past actions.

By applying control and running charts in order to put the date from their measures in context, discussions can be concentrated on improving processes, rather than just the end product.

The benefit of examining processes through trends and patterns, such as is done with Six Sigma business strategies, is that it becomes much easier to accurately pinpoint strengths and weaknesses within a business. By concentrating on the latest data only, a manager runs the risk of placing too much emphasis on a statistical error, or a simple exception in the type results were achieved. This means that an entire business effort or strategy could risk being altered due to a misinterpretation of the way that company is functioning.

By looking at past performances as well, managers are empowered with more of a "whole" view of the functions of the organization, and can determine how successes may be easier and more effectively achieved in the future.

Properly done, the result of well analyzed statistical patterns and trends will almost always be improved processes and therefore greater business achievements.