I spend a lot of time writing about metrics and performance management. It’s critical that we Know Our Numbers. It’s important to analyze performance over time, understanding where we are successful where we need to improve, and identifying new opportunities.
Having said that, at times we tend to either drown in data or hide behind constant analysis.
Our numbers are important, knowing where we are, looking at how we improve is important. But each of us has that “special number.” It’s not the magic number that tells you everything is in control, but it’s that number that tells you you’re probably on the right path.
For our business, it’s number of new prospecting conversations a week.
Yes, we track and analyze a lot of things. We track our pipeline, we look at project performance, financials, numbers on marketing campaigns, but we don’t obsess over them. For example, I glance at the pipeline every week and monthly, as a team we’ll spend a little bit of time, making sure things are on target and updating each other on what’s going on. But, we don’t obsess over it. We’ve gotten really good at qualifying and managing opportunities once they are qualified.
We obsess over prospecting conversations each of us has each week. Ultimately, they produce the opportunities that fill our pipeline and drive our revenue. It’s so easy to get distracted from this. It’s easy to focus on the deals in the pipeline. As a consulting company, we also deliver what we sell. As a result, projects can consume us. We get busy doing the work and it’s easy to put off prospecting. But through painful experience, we know if we don’t have the right number of prospecting conversations each week, in 12-15 months, our pipeline and business will be challenged.
Each of us has our “special number.” It may not be the most important number for the business (for example revenue), but it’s the one that tells you things are going in the right direction. Generally, they’re some sort of leading metric. It may be an activity metric, for example, number of telephone conversations a week. It might be the number of proposals a month. In some businesses, I’ve seen demo’s to the right audience being key. It may be the number of queries or responses to a certain marketing campaign.
Figure out what your special number is. Figure out that one indicator that you obsess over, the one that’s the cornerstone to everything. Don’t forget the other numbers, we have to pay attention to those, but find the number you obsess over. It will make all the other stuff a little easier.
For further research, there’s a great article in the New York Times, Every Business Has A Special Number Or Metric. Make sure you read it, there are some great, counterintuitive examples!
Dave, numbers are important, they are a key measuring stick for success.
Most companies can go too far and over-analyze data and forget the most important part of the process.
Contacting your key customers in the most efficient manner and closing deals.
If you are on the phone or face to face with your customer 75% of the time, you should be on the right track.
Fred: I don’t disagree. We need to maximize the time we spend working with customers — as opposed to the non sales time (current data show non sales time as much as 60%).
Having said that, there are probably one or two things that really drive each of us and our effectiveness. Identifying those, and using them as a guideline to keep ourselves on track is critical.
Taking your example, 75% of your time on the phone/meeting with customers, is not a great metric for our business. For us, the number of new prospecting conversations is the key metric.
Each business will be different, so it’s important that we understand the number.
But in principle, we are in total agreement. Thanks for taking the time to comment.