Lesson 4: Set Your KPI’s

Grow Your Business With KPIs

At this point, you must establish how you plan to measure your success and build value for your customers and your business. This part will look at value and growth indicators, and will help you understand how to apply them to your own business.

Make Progress With KPIs

You need to understand, track, and set goals to drive progress. This video will show you how to identify and select the key indicators that are critical for driving your business forward. You will also learn how these metrics help you to communicate and create shared understanding within your company and with investors.

Learn the Basics of Metrics

This video will take you through the vocabulary around metrics, and will help you understand which metrics you need to track to provide value and grow your business.

Understand Your Business Through Metrics

There are metrics that most every other business uses, and then there are those that help you grow. This video will help you to make sense of the metrics that are central to accounting, to investors, and to managing. These are powerful ways to think about metrics as a company.

Review Metrics to Make Progress

You want to have your key performance indicators, KPIs, drive your behavior and your understanding of how your business works. One of most powerful ways to make sure your company benefits from these KPIs is to have weekly check-ins with your team and investors to share good news, review goals, reviews KPIs, and clear any issues that may arise.

Evolve the Metrics You Track

You need to identify two or three measurable KPIs that matter to your business today. This video will help your team identify growth and value KPIs through the exploration of what your customers experience.

Trust Your Gut

Entrepreneurship is a blend of art and science. In some instances, you won’t have data science to show you where to go and you simply have to trust your gut. KPIs can create a numerical baseline to your gut responses. This video will help you think through ways to get the easiest and fastest measurements that you can use as evidence.

Find Your KPIs Workshop

This video will take you through an example of mapping the customer experience up to the moment of a transaction, and then how to plot the metrics for growth and value KPIs that teams can measure and monitor.

·       Apply Your Knowledge

·       Grow Your Business With KPIs

·       Know Your Terms

When we discuss key metrics, either within our own team or with investors, it is important to know which terms mean what. If we don’t understand the nomenclature, then we risk making promises we may have no ability to deliver. Using the form below, try to identify corresponding variables in your own metrics in the fourth column.

Metrics Evolve

Your job now is to find the two or three measurable KPIs that matter today. You and your team will then use these KPIs to measure the progress of your business.

Finding these KPIs will help you navigate to a place where the business works, to focus your coordinated efforts with a conviction to change, and to develop a company culture that can adapt and commit to new KPIs quickly.

Instructions:

Your team’s goal for this exercise is to identify growth and value KPIs by exploring customer experience and metric types.

First, replicate the diagram below on a whiteboard or flat wall. Then make sure everyone on your team has blue, yellow, and green sticky notes and a black marker.

Second, map what your direct (blue sticky notes) or indirect customers (green sticky notes) experience up to the moment of a transaction. Try to work your way left out from the $$$, going back as many steps as you can to the point before the customer even knows your product exists. Keep in mind that some of the experience points extend past the moment of transaction.

Third, use yellow sticky notes to identify and plot the key metrics that show you that you are running a valuable business. These should start to plot closely to the experience points of your customers.

Finally, as a team, identify the top two or three growth (customer experience) and value (yellow) KPIs that you and your team can measure and monitor.

Plot Your Metrics

Take a look at the KPI metrics you chose to measure. Where do they fall on the spectrum below? Tip: go back to the “Know Your Terms” section to help you determine which types of metrics each one represents.

While it’s permissible to have Accounting or Investor KPI metrics, the really exciting growth takes place when we can steer the business with Management KPIs.

Setting Next Steps

Once you have identified the Value and Growth KPIs, determine how you will measure these KPIs, ensure someone is monitoring the KPIs, and establish a regular cadence to review your KPIs.