In the words of Albert Einstein “everything that can be counted doesn’t necessarily count; everything that counts cannot necessarily be counted”. I love this quote because if you don’t consistently pin down the numbers that matter to you and your business, it becomes easy to lose sight of the bigger picture.
A measurement framework defines what success looks like. It connects objectives to metrics and is an easy way to demonstrate and understand what is driving your business forward.
The Marketoonist – Tom Fishburne – has been capturing marketing challenges in cartoon form for many years and his data driven portfolio is no exception. As he portrays in his marketing dashboard picture, many organisations track lots of metrics; but it’s important to identify and define the few (5-10?) that are most meaningful – that help to track overall business performance and return on investment.
To be actionable your insights must be relevant – any metrics you measure need to ladder up to your business objectives, whether that is to sell more or to be more efficient by reducing inbound calls to your call centre. Plus, these metrics need to be consistent across teams and departments and you need a rigorous approach to segmentation: i.e. understanding metrics across the customer lifecycle.
Finally, there’s a need to aggregate reporting for different users to make sure your metrics are always collected and reported in the context of business objectives and the segmentation layer will help capture those highly specific, actionable insights for each department/team.
Measurement frameworks help you understand the here and now – the diagnostics: what happened and why did it happen? There are various diagnostic analytical techniques to do this, but the real value is in what will happen next and what you can do now.
More and more of our conversations with clients are about the trajectory of metrics, and our ability to use past performance to predict things before they happen, to identify strategies and remedies that drive further growth. Scenario planning, forecasting and predictive analytics have become increasingly important and in today’s world there is the need for constant evaluation. Business objectives change in response to a variety of internal and external influences, and when this happens, so should your measurement framework. Check on an interim basis if any of the key metrics need to change and if you’re still measuring (and calculating) the right ones.