It’s often said “What gets measured gets improved.” What does this mean in real terms? In terms of a nonprofit that needs to report metrics in order to receive grant funding? In terms of a small business who is applying for a loan to increase their operations? Or a large corporation that needs to report back to the Board of Directors on the successes of the last enterprise-wise marketing campaign?
This means, if you don’t have the proper metrics and reporting mechanisms in place, your organization could be hurting and you may not even know it.
We see it all the time. The customer service center that measures “customer call duration” as a Key Performance Indicator, or KPI. If that was a useful metric, then this call agent would win Employee of the Year solely based on the length of call. We’ve seen a company measure the “amount of new project ideas,” while that sounds like it could be useful, it’s really moot without supporting metrics under it (i.e. a measure of fleshed out ideas at various stages of development).
Let’s see if we can make some improvement on the metrics examples above. Instead of looking at “customer call duration” you could measure:
Customer Satisfaction Index
Net Promoter Score (or NPS)
Customer Complaints (with detailed classification)
Instead of measuring simply the quantity of new ideas in a forgotten innovation email inbox, consider:
Innovation Pipeline Strength
Return on Innovation Investment
Or if you’re in the nonprofit realm, consider these useful metrics:
Fundraising Return on Investment
Year over year gift size
Donor retention rate
Fact is, before we start measuring everything, we need to focus on the important things. What are the indicators in our business that give us the best gauge of how things are going? Will we be able to see a future derailment long before it happens?How do we know we’re really and truly doing well?
Conversely, measuring everything can be a bit of an issue too. There’s absolutely no need, even in this world of data mining, and $1/terabyte data storage, to measure everything. It’s a bit like crying wolf if we’re honest. There can be a much deeper impact if you focus on the critical indicators within your business. If we say “What gets measured gets improved,” then there’s no physical way to simply improve upon everything at once, and much of that work would no doubt be meaningless to the bigger picture.
So, take your time measuring your time, efforts, innovation and other things. Find out what the most meaningful indicators in your organization are, and go measure them! Just don’t go measuring how long it took you to figure it out, that won’t be very useful.
Metrically yours,
Nik
