If you are a data-hungry entrepreneur, then this article is for you.  It’s an early step in our consulting process to start developing metrics and Key Performance Indicators (KPIs). Our initial KPIs usually show some data clean up is needed. That usually leads to some process creation to get everyone on the same page about how we use our systems so the KPIs reflects a consistent reality.  Lastly, we work on process improvement and use the KPIs to determine if we are impacting the data as we expected, or not.

However, shortly after we start seeing these numbers, a phenomenon always happens. Our clients want to see more and more numbers. I get it, as soon as you see the power of empirical evidence evaluating your efforts, it becomes a bit of an addiction. However, it’s a leader’s job to simplify!  Simplification is NOT easy, but it nets the best results.

When we are first adding KPIs to an organization, we are usually aiming to fill out a Scorecard for the Leadership Team meeting. Scorecards are designed to be the 3-7 most important numbers to the organization (for Leadership Teams, for other teams it may be the 3-7 most important to their team). Preferably these are leading indicators.  As a quick example, CSAT (Client Satisfaction) is an important metric, but can only be measured when its too late.  Metrics such as Resolution Time, Response Time, or perhaps even Ticket Touches can give you some early indications to CSAT.

To expand the example to see how the number of metrics tends to multiply, the desire for CSAT actually gave us three other metrics we might want to see. We then learn that when measuring Resolution Time, there are several behaviors that cause those crazy long-to-resolve tickets. One is that technicians forget to put their tickets into Waiting on Client status. So now we want to add a metric for that.  Not to mention, that another tech leaves his tickets in In Progress status overnight, and that’s hitting our metrics too, so we need a number for that.  None of these are bad numbers to look at and act on. However, this is becoming far too many for a Scorecard, especially a Scorecard on the Leadership Team where we also need KPIs for Sales and Finance.  This is where we really crack down on the “K” in KPI standing for “key.”

Our solution in this case, is then to create some Dashboards. Dashboards are just a visible collection of related data. Common Dashboards might be:

  • Dispatch
  • Service Manager
  • Help Desk Team
  • Finance
  • Sales
  • Marketing

As you develop your dashboards, the end game could get down to each individual having their own Dashboard. What exactly are the numbers than an individual needs to see at a glance?  This can become especially powerful when its not just “measurements” but also can show what stats need to be ACTED on immediately.

I digress a bit, because I love numbers so much,. So far we have seen Scorecards and Dashboards. For those data-driven folks, we can make them feel a lot better knowing they have ALL the numbers on their Dashboard, and now they don’t feel like they are missing anything when we look at just the 3-7 numbers on their Scorecard.  Further, as those Dashboards are being watched by various team members and perhaps managers, the leadership team can be more comfortable that the details are being handled, while the Leadership Team just looks at the resultant numbers on the Scorecard.

Here’s a common example of how this works. Let’s pick a common case Leadership Team Scorecard:

  • CSAT Last Seven Days – Target >90% – Actual 96%
  • Help Desk Resolution Last Seven Days – Target <2 hours – Actual 2.5 hours
  • E-Rate Last Month – Target >80% – Actual 82%
  • # Qualified Leads Last Seven Days – Target >1 – Actual 1
  • Agreement Gross Profit Last Month – Target >66% – Actual 78%

Scorecards are used during meetings to red light/green light which numbers need discussion time. In the above example, all numbers except one are green, because they are better than their targets.  The one red number would be the Help desk Resolution Time, over our target by half an hour. This method of red/green keeps us from spending valuable meeting time reviewing numbers that are good.  We can now focus on the fewer red numbers. The conversation typically dives into finding out why is it in the red. If corresponding Dashboards are available, there is a great a source to dig in and find out. Better, is if there is a dashboard that the service manager is in charge of.  In a well functioning environment, the Service Manager is not surprised by the  Scorecard and already has the explanations ready, or better yet, the solution in place, making short work of this part of the meeting.  Now the Leadership Team can help solve the issue, while the Service Manager can continue to monitor all the details on their Dashboard throughout the week.

Last cautionary note. How many metrics, KPIs, scorecards, and dashboards you have depends heavily on your company size and growth plans. If you are new to metrics, starting with just one is great work. Never berate progress. And now you know that too many is also a problem and you have some strategies to combat metric-creep.  I feel some of the articles that I’m most passionate about, I have the hardest time with because there is so much I want to add, but we all only have so much time. We’d love to hear your thoughts and challenges in the comments below so we can continue the conversation.