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One More Thought on Metrics​​

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The last few Fridays (except for a couple of hiccup/no-content days), I’ve been talking about the way internal audit departments’ measure their success. (You can see them here, here, and here.) A major point I intended to make was that we focus too strongly on financial and process measures, avoiding measures related to our most important asset – people. The number of financial and process measures always seems to far outweigh those related to how we identify, support, and develop talent. 

But, after all this discussion, another thought came to mind; actually, a rather heretical idea. Quite simply, maybe we should just quit worrying about measures of success. What if we just didn’t do it? After all, what is the point?

These are not rhetorical questions. I’m completely serious. What are all these measurements about? 

Well, of course, the quick, easy answer is that they exist to show the board and executives what a really spiffy, splendiferous job the audit department is doing.

To which I reply, “If they have to ask if we are successful, then we have failed.”

All the metrics in the world – audits completed; utilization; findings implemented; audits completed on time; actual hours to budgeted hours; reports issued with a minimum of rewrites; surveys with an “exceeds expectations”, “really exceeds expectations”, or “really, really, really exceeds expectations” rating.; any of the myriad machinations we go through to show what we have accomplished – mean nothing if their only purpose is to prove to our primary customers that we have provided value. No amount of numbers, statistics, calculations, bar charts, line graphs, pie charts, or even spirographs will make up for a lack of constant dialogue with those customers – a dialogue that includes determining what they think they need, what they may not realize they need, and how internal audit is providing those services better than anyone else.

Success is not numbers. Success is a board that, when approached by someone to outsource the department, laughs them out of the room. Success is C-Suite executives that come to the auditing department to discuss the world. Success is our customers/clients/stakeholders wanting to know why we haven’t been around more often. Success is anyone – from the board to the line personnel – coming to internal audit for advice when any new issue, risk, or opportunity arises.​

Unfortunately, it is nigh on impossible to measure such intangibles. The supreme court, many years ago, famously said about pornography “We know it when we see it.” And that is just as true for defining the success of the internal audit department. Measurable or not, everyone knows success has occurred when the customer responses described above become commonplace .

We know it when we see it.

Of course we want to make sure we are getting the work done and developing people and responding to our clients and doing it all in a timely manner. But measures of success in those areas are just support to the ultimate measure…

Would they miss us if we were gone?​

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