Measuring Your Decision Yield
Decision Yield is an evaluation metric that reveals the quality of your current decisions and decision processes, and helps you plan, justify and measure improvements.
What constitutes a good decision? Is it the outcome alone? The cost of executing that decision? The speed? How about the coordination of multiple decisions across different parts of your organization?
Many organizations lack a consistent method for measuring and managing the performance of automated decisions. Plans for decision process improvements that are vital to an organization's growth are often made based on metrics that focus on only one dimension of the decision process, such as cost savings alone.
To determine what constitutes a "good" decision process, it is critical that executives understand the many different facets of a decision that contribute to overall business performance. This holistic way of evaluating decisions is what we call Decision Yield.
Decision Yield is designed to evaluate automated decisions which are typically:
- Customer-facing - from approving loans to pricing insurance to determining cross-sell offers
- Very frequent - often many thousands of times a day
- Driven by strategies and rules - and often supported by predictive models, decision models and optimization
- Executed in real-time (such as a fraud check) or in batch / offline mode (matching an offer with a prospect)
While the value of each individual decision is small, in aggregate they can drive a large portion of your organization's performance.
By comparing 5 different dimensions of decision effectiveness, Decision Yield allows for a more comprehensive assessment.
The Decision Yield metrics:
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Precision |
Increase revenues and improve risk management through greater segmentation, more relevant offers, better risk management and more finely detailed processes. |
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Consistency |
Ensure that all decisions meet your rules, policies and regulations, by automating 75% or more of your operational decisions. |
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Agility |
Meet new competitive and compliance demands by rapidly changing your business rules, and instantly executing new decision strategies and processes. |
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Speed |
Give faster answers to customers, reduce decision handling times and increase operational efficiency. |
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Cost |
Reduce the amount of system resources, labor and other costs required to make decisions. |