How to Measure Anything: Finding the Value of Intangibles in Business
Douglas W. Hubbard
Format: PDF / Kindle (mobi) / ePub
Now updated with new measurement methods and new examples, How to Measure Anything shows managers how to inform themselves in order to make less risky, more profitable business decisions
This insightful and eloquent book will show you how to measure those things in your own business, government agency or other organization that, until now, you may have considered "immeasurable," including customer satisfaction, organizational flexibility, technology risk, and technology ROI.
- Adds new measurement methods, showing how they can be applied to a variety of areas such as risk management and customer satisfaction
- Simplifies overall content while still making the more technical applications available to those readers who want to dig deeper
- Continues to boldly assert that any perception of "immeasurability" is based on certain popular misconceptions about measurement and measurement methods
- Shows the common reasoning for calling something immeasurable, and sets out to correct those ideas
- Offers practical methods for measuring a variety of "intangibles"
- Provides an online database (www.howtomeasureanything.com) of downloadable, practical examples worked out in detailed spreadsheets
Written by recognized expert Douglas Hubbard—creator of Applied Information Economics—How to Measure Anything, Third Edition illustrates how the author has used his approach across various industries and how any problem, no matter how difficult, ill defined, or uncertain can lend itself to measurement using proven methods.
rated the same should change the ranks, and yet it can.22 In my other book, The Failure of Risk Management, I quote several decision analysis researchers who, because of these problems, insist AHP is not a credible tool. (I mention AHP in that book because so many use AHP to assess risks instead of proper probabilistic methods.) But even the theoretical flaws should not themselves be an obstacle. So what if there are theoretical flaws? None of the theoretical papers on the topic attempts to
different way and get the customer to the right vacation.” Simply discovering the problem was a measurement success. Now the company needs to measure the effect of the new program. Anyone can sign up on Google and download detailed data from Google Trends. It shows how trends in search terms of Google users change over time and is even broken down by city. An index of the Amazon sales ranks of 100 or so books about interviewing and job hunting compared to other books could indicate changes
Detailed computer simulations are considered standard practice in many other areas. Modern weather forecasting has allowed us to at least foresee the possibility of a hurricane hitting a major city much earlier than used to be possible. Structural models of buildings in earthquakes are used to test designs. Many of these simulations also depend on Monte Carlo methods to generate thousands or even millions of possible scenarios. Once again, the reason why a measurement is important to a
said all this, it is important to state three caveats about regression models. First, correlation does not mean “cause.” The fact that one variable is correlated to another does not necessarily mean that one variable causes the other. If church donations and liquor sales are correlated, it is not because of some collusion between clergy and the liquor industry. It is because both are affected by how well the economy is doing. Generally, you should conclude that one thing causes another only if
much they think someone else would be willing to pay for it), the value of a brand (at best, how much more consumers are willing to pay for a product with said brand), the value of used equipment (again, how much someone else would pay for it), and the like. No matter how “objective” they believe their calculation is, the fundamental unit of measure they deal in—the dollar—is a measure of value. This is why one way to value most things is to ask people how much they are willing to pay for it