How Do You Measure Value? 3 Not-So-Obvious Objectives (and Results) You're Missing Out On As you assess your business at year's end, look beyond the typical numbers for gauging performance.
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If you run a data-oriented company, you have clear key performance indicators (KPIs) and objectives and key results (OKRs) that you review personally or with your team on a monthly, quarterly or annual basis.
These are typically run-of-the-mill data points: customer retention rate, operational cash flow, profit margin and more. Or, this could be as simple as setting a goal for a certain number of clients per month and reflecting upon eventual progress.
As helpful as this numeric data is, there may be some important value points that the analytics alone won't show — things that still tell an important story about how your business is performing. This could include aspects of your business that are invisible to you, yet pertinent to customers, such as response time via social media, lackluster branding that fails to capture widespread appeal or sales copy that doesn't simply resonate with buyers.
As Toma Kulbyte shared via SuperOffice, "Customers no longer base their loyalty on price or product. Instead, they stay loyal with companies due to the experience they receive. If you cannot keep up with their increasing demands, your customers will leave you."
Many think that a simple survey of their brands' latest superficial numbers can help determine what needs tweaking and what's going well. This type of oversight, however, can lead to drastic consequences with your business. Instead, assess how you and your business value each of the following with a process that analytics struggle to trace in a black-and-white way.
1. Value to your customers
It's easy to assume that things are going well if you're meeting your monthly revenue goals. But what if someone told you that you're only selling half of what you could because the value that you're offering your customers is lacking? Often, there's a lot that isn't said by the customers or can't be read identified on spreadsheets because the data for it just doesn't exist.
Sure, you may have information on how many sales you made last quarter or how many return customers you have, but do you have any methods for understanding how you're offering value to your customers? Key to this understanding is how some OKRs need to be measured in terms of flow metrics.
Dr. Mik Kersten, founder of Tasktop, reflected upon these challenges during a recent email exchange. "For organizations that create value through intangibles — such as software, for example — measuring the flow of value to the customer is critical," he noted. "While practices such as OKRs are established, setting OKRs for intangibles that are meaningful to both the makers doing the work and the managers supporting it is far from universally understood."
Within Tasktop, they've circumvented these problems by collectively coming up with more creative forms of OKRs, such as the number of happy customers after a series of customer-service calls, the number of online reviews or — in some cases — positive conversations held with customers.
The skinny of the situation? There's tremendous value in qualitative feedback. Consider how you can do the same when determining value, whether it be through asking a few additional questions while on the phone with a customer or thinking outside the box about what your OKRs could entail.
2. Value to prospective customers
Especially when running ads, less-experienced marketers often assume all types of data demonstrate how prospective customers are responding, but this isn't always the case. For example, Annemaria Duncan, a content and consulting manager at Swipeclock, told Forbes, "Often in marketing, results may lag behind your activities. It can take Google and other search engines time to index your content. It takes time to build trust online."
In other words, don't take numbers at face value. Look beyond the OKRs that you may have originally set for your brand's advertising efforts. Instead, if you're seeking to offer real value, think through a variety of content marketing initiatives and realistic ways to prove what you know to your prospective customers.
Furthermore, seek to go deeper than the numbers. A wide variety of technological advancements exist that track a prospect's behavior and movement on your website so you can see where they are and aren't taking action — again, valuable data that typical OKRs usually don't consider.
3. Value to your stakeholders
Finally, it's considered far less frequently, but the value that you're offering to your stakeholders matters more than OKRs can show. In this case, your stakeholders can include investors, but also employees, as well as those committed to your company and its future success.
Aside from year-end reviews, semi-frequent conversations and the occasional survey, understanding the value that you're offering these investors and team members is seldom discussed at length. Don't be afraid to have those hard conversations. Ask more qualitatively driven questions about how you can improve as a company and as a leader, and value what's said in response.
While cash is understandably king in any business, ask how you can better serve your stakeholders and keep them in the loop. Take these answers into consideration when your team freshly assesses your KPIs. Running a business is about continuous, holistic improvement. Get beyond the numbers to ensure that your company is doing the best it possibly can.