03 Mar What Gets Measured Gets Done
This title, first shared with me by a friend and mentor and often attributed to Peter Drucker, encompasses the power of setting expectations. Measurement is not always fun and sexy, but it is powerful. It allows you to build a real understanding (rather than rely on a gut feeling), make informed decisions, and ensure accountability.
Below are a few quick thoughts about measurement.
Get A System (And Use It!)
Leads, conversions, client interactions, and the success of specific channels, promotions, or individuals are all relatively easy things to measure. If you’re doing this now, then you’re already off to a great start. If you’re not, there are many systems available to help you and your team track this information. Pick one and start collecting.
It never ceases to amaze me how many times I speak with successful business people and find out that they have no system or rigour for tracking their success. What they are failing to understand is how much more successful they could be if they just gathered and evaluated some basic business intelligence.
Figure Out What’s Important
Not everything you measure is of equal value. Some of what’s important may change over time or depend on circumstance, but there are a couple of key indicators that really drive your business and that you need to pay attention to. Here’s a hint—it’s not revenue or profitability. Yes, these are important, but what’s more important is understanding what causes improvements to revenue and profitability. If you’re thinking customer retention, repeat purchases, referrals, results by channel or segment, or client and employee satisfaction, you’re getting closer.
Figure out what’s important and focus your team around these key indicators.
What Gets Measured Gets Done
After you’ve figured out your key indicators, the next step is to have a plan. Developing a plan with measurable objectives for each area of your business sets the expectation and allows you to have informed discussions about what is and isn’t working.
A traditional example would be when your salespeople need to generate X leads with a conversion ratio of Y and an average sales Z to meet your basic sales expectations. If you set the expectation and measure the results, you can manage against it. This goes for all areas of your business, not just sales and marketing. HR, IT, Finance, and Operations should all have specific key measurements with regards to how they contribute to your business.
Measure it, understand it, and get it done.