Performance & metrics

The Performance & Metrics building block defines how success is measured and managed across the organisation. It includes the KPIs, OKRs, dashboards, and feedback loops that track value delivery, efficiency, quality, and customer outcomes. This view ensures the organisation not only sets goals but also monitors progress and adapts based on evidence.

Why it's important

Without clear metrics, the operating model lacks direction and accountability. Performance & Metrics provide the fact base for decision-making, enabling leaders to steer, teams to self-manage, and stakeholders to trust outcomes. Well-designed measures align everyone around shared objectives, while poor metrics create local optimisation, gaming, or misaligned incentives.

Interactions with other building blocks

Organisation – Defines who owns targets and who acts on results.
Processes – Process performance is tracked through flow, cost, and quality measures.
Systems & Technology – Provide the data and analytics to measure performance.
People & Capabilities – Metrics drive behaviours and learning focus.
Governance & Policies – Define how performance is reported and how decisions are made based on data.

Common challenges

When defining this building block, key questions include:

What are the critical success measures for our organisation?
How do we balance lagging indicators (results) with leading indicators (predictors of success)?
Do we measure value delivery (customer outcomes) or just activity?
How do metrics cascade from strategy to teams (e.g. OKRs)?
How transparent should performance data be across the organisation?
What mechanisms are in place for review, learning, and improvement?

Our vision

It is our experience that metrics are not just about facts represented by numbers and graphs; they will only be successful with the right mindset.
Metrics should always be interpreted as part of a balanced set to avoid sub-optimisation.
Be careful with focusing only on financial or activity measures and ignoring outcomes.
Since optimising flow is one of the goals of a well-functioning operating model, we must have reliable metrics to measure this flow.