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4 steps to measuring what matters

from Harvard Business Review

When it comes to assessing performance, business executives can be a lot like old-time baseball scouts. They've been around so long that they've developed a gut feel for which statistics matter most. But as Michael Lewis describes in "Moneyball," the Oakland Athletics discovered that the metric the team's scouts used to choose players had nothing to do with whether those players would score runs. They had been measuring the wrong thing, and executives may be making the same mistake. The statistics that companies use most often to track and communicate performance include financial measures such as sales and earnings per share growth. Yet these have only a flimsy connection to the objective of creating shareholder value. more

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