I’m a firm believer that you have to measure what matters.
And what is measured can be improved. The inverse is nearly impossible.
I’ve read countless articles describing that you should only track a few metrics. I disagree even though I see the angle where they’re coming from.
Perhaps, their statement could be rephrased as “track a couple of metrics that define the business.” These are the high-level metrics like revenue, acquisition costs, profit margins, etc.
But I believe tracking specific metrics at a weekly and monthly cadence gives you a deeper pool to make decisions faster and better.
A caveat to avoid is spending hours collecting the metrics. Thankfully there are automation tools like Zapier and Make.com. And most tools nowadays have an API that you can plug into. And if all else fails, virtual/executive assistants are excellent at collecting this type of information across multiple data sources.
Also, there is a line to draw in regard to which metrics to gather. I don’t see a need to collect click data in your application just to have clicks per day. Instead, you can use click data to influence engagement scores and define DAUs and MAUs.
Now, what decisions can you make with this data?
I’ve found success with Hawthorne Effect. Wikipedia defines it as “the effect is a type of human behavior reactivity in which individuals modify an aspect of their behavior in response to their awareness of being observed.”
This works whether you’re a team of one or operating a company. By focusing your activities around business metrics, you create an organization obsessed with improving these metrics.
Haters will claim this incentivizes poor behavior and a focus on improving metrics just for the sake of improving a number.
And my response is those are opportunities to course correct and remind team members of your customers behind the metrics. Surprisingly this happens seldomly. And the other concern is mostly fraudulent behavior from the team which happens even less.
The obsession with metrics is focused on beating the baseline. It creates a unique type of energy that is motivating and empowering. Every team and team member is responsible for a metric. And their goal is to improve it. Marketing is responsible for increasing the number of leads or decreasing the customer acquisition cost. Customer support is focused on driving churn down. And sales is working to increase their penetration of add-ons at the point of close or reducing the days to close for key accounts.
These metrics lead the team and company meetings. It’s the one thing every person in the organization can understand and see progress (or lack thereof).
And lack of progress is nothing to be ashamed of. It’s an opportunity for other team members to key in on where their colleague is struggling to break through and they should lend a hand when able. Lending a hand does not mean dropping their responsibilities to pinch hit. Instead, they should share ideas, offer to be a sounding board, share customer insights the team may have missed, and help them in any way they can.
Occasionally the baseline can not be beat and the team should instead focus on another metric. This is a harder one to solve because you want teams hitting the wall of despair. The wall of despair sparks innovation out of desperation. It’s a hard one to weigh. The last thing you want is to create a disheveled team and drive company attrition. This is not a problem and you’ll see signs of it as long as you focus your meetings on metrics and keep close to your teams.
After a couple of weeks of misses, it’s likely time to rethink the metrics the team is attempting to beat the baseline for. And heck, sometimes switching a team’s focus to a new metric will spark an “aha” moment that positively affects both metrics (the new one and the old one they were stuck on).
I urge you to track more metrics than you and attempt to beat the baseline. The compounding of beating the baseline has astronomical benefits for the company and yourself. This is when you see exponential growth. And the learnings you’ll gather from focusing on beating the baseline will make progress even faster and easier.