Analysis

When you cannot measure it or express it in numbers, your knowledge is of a meagre unsatisfactory kind. Lord Kelvin

The analysis issue assesses what the element consists of and how well it is defined and understood.  For example; has the organization defined and understood the major threats to its existence, is there a clear definition of the reporting structure or is it aware of the information required by government?  Are the management aware of all the compliance activities, or all the incidental activities?  Managers will not have first-hand knowledge of these things, they should know where to look.

Measurement is important: Each element should be capable of being defined and measured.  For example, an organization needs to understand how its 'reputation' is defined by the marketplace, and have some way of monitoring and measuring it. Car maker Mercedes-Benz, tracks reputation by the proportion of customers buying another Mercedes, while its competitor Jaguar places great emphasis on its position in the JD Power customer satisfaction survey for car owners.  A pharmaceutical company’s reputation may depend on the number of new drugs it discovers and a school's reputation on students’ examination successes.

Key instances: The most important instances of specific elements should be identified.  For example - who the key customers and suppliers are, which skills the organization is dependent on, which processes are critical or where the major threats are coming from.  Dutch airline KLM analyzed their customer and sales data bases to discover that many passengers flew economy to the US but business class back, to cope better with jet lag.  This analysis and understanding of their information enabled them to create a new category of fare and win new customers.  Analyzing information is increasingly being used to keep ahead of the competition.

Keeping information about elements: Knowledge about specific elements is often carried in the heads of staff and this represents a risk for the organization since they could leave and take this knowledge with them. For the management to exercise proper control, it should ensure that each element is formally defined and recorded and that this record is available to the appropriate people.  This may be difficult for some elements that straddle departments or are difficult to define, such as the risks the organization faces, workers attitude to their jobs, the various rules and customs, etc.  >>>