Most business leaders know intuitively they should be using data to measure their organization’s progress and drive future decisions. However, when things get busy, data is often the first item to drop off the radar.
Have you made performance measurements a priority at your organization? When you understand the advantages that monitoring data can offer you may be more willing to make it a consistent priority. Using metrics to set clear, quantifiable goals within your company offers four distinct benefits:
1. Performance measurements help to create focus by offering clear goals. Some departments—such as your sales team—may live and die by their numbers. However, other departments may lack the hard-number goals that keep them motivated to perform. If your team doesn’t have a realistic goal guiding their day-to-day work, they may end up feeling unmotivated and directionless. Numbers give people something to shoot for.
The metrics you choose need to be meaningful. Annual numbers are too abstract, and even quarterly numbers may get ignored until the final two weeks of the quarter. Figure out what defines “success” for each one of your departments and work with your leadership team to pick a metric which tracks that measure of success. For example, does your marketing department keep track of the number of prospects their campaigns bring in the door? Does your technical support team track the average resolution time for their tickets?
By giving everyone a quantifiable number that guides their daily work, you’ll be offering them clear targets for results and setting up your company for consistent success.
2. Using metrics can also help your team grow. Tracking the right data also enables your managers to create accountability by establishing clear expectations for each of their team members. By examining each person’s results, your managers will get a quick snapshot of how each team member is performing in that dimension. Team members who need additional management or training will get the attention they need.
Additionally, within a team setting, performance measurements can also help to create a greater sense of teamwork by increasing camaraderie—and even some healthy peer pressure—to perform.
3. Keeping track of your business metrics is also good for revealing potential problems—before they grow too large. Monitoring performance measurements throughout your company will give you a good feel for how your company is really doing. Potential stumbling blocks will become evident long before they become large issues, allowing you and your team to attack them head-on and solve them proactively. For example, if your tech team is suddenly spending significantly more time closing tickets, you might uncover a system glitch that needs attention before it halts your whole operation.
Using your data to spot problems early on allows you and your team get out in front of your challenges, rather than waiting for them to impact your bottom line.
4. Relying on hard data, your leadership team can reduce the amount of time it takes to make the big decisions. Timely decisions keep your organization on track toward fulfilling its overall vision. By creating a clear set of measurable metrics which are well-defined, easy to track and understood by everyone in your organization, you’ll be able to make informed choices backed by solid data.
It will also get you and your team in the habit of collecting important metrics as you build your business, rather than running around after the fact to collect numbers. These habits enable the clarity and honesty you need to make the right decisions for your business’ future.
One Final Note – we’ve all heard rumors about companies who have gone data crazy and lost their perspective in the process. Performance measures are designed to help you reach your ultimate outcomes, but they’re not your end goal. As you introduce performance measurements into your organization, make sure you do so with the right perspective. Your chosen metrics represent a single dimension of your company’s health. They always need to be assessed with your company’s ultimate vision in mind. In other words, when you’re analyzing data, always ask yourself what you are really trying to achieve—and how this number will get you there. Then, make your decisions accordingly.
.
.
.
This article originally was posted to the Vistage.com blog by Kevin McArdie on May 23, 2013.
.
.
.
