identify metrics that could be useful tools for industry.3 The group found that the development of useful metrics in the manufacturing sector begins with careful formulation of the objectives for creating them. Important questions to be considered include the following:

  • What is the purpose of the measurement effort?

  • What are the “issues” to be measured?

  • How are goals set for each issue?

  • How is performance measured for that issue?

  • How should the metric be compared to a performance standard?

  • How will the metric be communicated to the intended audience?

Metrics that have proven useful in the manufacturing sector tend to have the following attributes:

  • few in number, to avoid confusing the audience with excessive data;

  • simple and thus easily understood by a broad audience;

  • sufficiently accurate to be credible;

  • an agreed-upon definition;

  • relatively easy to develop, preferably using existing data;

  • robust and thus requiring minimal exceptions and footnotes; and

  • sufficiently durable to remain relatively constant over the years.

Metrics used in manufacturing tend to focus on input, output, or process (see definitions in Box 1.3), and they are commonly normalized to enable comparisons. In general, output metrics (e.g., pounds of product per pound of raw material purchased) have been the most successful because they are highly specific, relatively unambiguous, and directly related to a specific end point. Over time, and frequently after adjustment based on learning, the use of metrics in the manufacturing sector has been so effective as to give rise to the maxim “what gets measured, gets managed.”

Extension to Research and Development

Success in the manufacturing sector encouraged efforts to develop quantifiable metrics for research and development (R&D) beginning in the late 1970s.4 However, problems immediately arose. The most successful manu-

3  

The group meets under the sponsorship of the American Institute of Chemical Engineers’ (AIChE) Center for Waste Reduction Technology. See reports on AIChE collaborative projects, focus area on sustainable development at <http://www.aiche.org/cwrt/pdf/BaselineMetrics.pdf>.

4  

Blaustein, M.A., 2003, Managing a breakthrough research portfolio for commercial success, Presentation to the American Chemical Society, March 25, 2003; Miller, J., and J. Hillenbrand,



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