How to Develop a Monitoring and Evaluation System

In a business or other organization, the monitoring and evaluation system determines whether the organization is using its resources efficiently and effectively. The system collects information, evaluates project performance and compares it to goals and plans for the company and its departments. The better your monitoring and evaluation system, the more effective and competitive your organization can become. Having a good monitoring and evaluation system starts with developing the system that's most appropriate for your organization.

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   List the problems your organization wants to solve. If your organization already exists, you will be looking at losses, risks and underperforming departments. If the organization is still forming, you want to look ahead to problems you anticipate.

   • This step can also include listing the things you want to learn about how your organization performs.
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   Make a list of indicators for each problem you want to solve. Indicators should be concrete and measurable, as well as objective as possible. Without consistent measurability, it's difficult to develop a meaningful framework for monitoring and evaluating the different processes in your organization.
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   Determine how you will observe and measure the indicators you have chosen. This includes the scale you will use, the points at which you will make observations, and the frequency with which you will record and measure.
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   Write a brief job description for each observation task, for each indicator, for each area you want to address. This can just be a sentence or two. At this stage, you're still developing the plan, not writing a formal process document.
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   Assign somebody for each job description. Multiple people can hold multiple job descriptions, or you can assign them to individuals best placed to make and understand the observations.

   • It's best to assign a title to the job description rather than a specific individual. If the line manager is responsible for a task, the task will get done by whomever the line manager is. If it's Don's job, the task stops getting done when Don gets promoted or retires.
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   Determine how you will use the information you gather from the previous steps. In some cases, you'll base the analysis by comparing the reality to benchmarks you set. In others, you'll base it on growth or decline as compared to other time periods. New companies might use industry averages, or use the first set of measurements as a baseline.
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   Write a rough draft of the monitoring and evaluation system. Hand it off to somebody you trust who hasn't been involved up to this point. Ask that person to read it and report anything that doesn't make sense.
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   Edit step
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   Make the necessary changes and clarifications, then format the document into a formal process manual.