Howdy, Zack here.
Your scorecard doesn't work. Your metrics are a mess. Your KPIs don't indicate anything.
And you're wasting your time in reporting them. Unless that is, you are looking at the right data and using it effectively.
Unfortunately, this is the story of nearly every client I've begun to work with over the years. By now, we all know the importance of tracking data (metrics, KPIs, etc.) on a scorecard for our business. But few do it right, and even fewer do it well.
A few years back, I was excited to take on a new client in the outdoor space. They did about 30mm in business annually, with much potential for growth. On our first day's session, I asked to see their scorecard and was shown a document with 55 metrics.
My first question to their Senior Leadership Team (SLT) was, "How long does it take to report on these 55 metrics each week?". The CFO replied that it takes a full day for someone to pull it together. My second question was, "When was the last time you recall making a decision from your scorecard?". The team looked slightly puzzled. They understood the question, but at that moment, they realized it takes a full day each week to report on metrics they're not using. By the end of that day's session, we had a new scorecard of 15 metrics. Fast forward a year — that team more than tripled their revenue to over $90mm.
🍍 So, how do you get control of your data, and how do you use it in a way that works? I like to share this exercise in my client sessions. I want you to picture yourself on a remote island sipping a piña colada. The Internet is down, and you only have a screengrab of the scorecard you captured the night before. If you have the right data, you should be able to quickly tell where your company has been and where it's going — able to predict the future with greater accuracy. With that peace of mind, you can sit back, finish your drink, and enjoy your vacation. What metrics make this possible for you?
Here are a few more tips to build a better Scorecard with data that matters:
- Limit your scorecard to the most important metrics for that team.
Typically, 7 to 15 metrics per team are plenty if you choose the right ones.
- Have the right mix of leading and lagging indicators.
Your data should tell you where you've been and where you're going.
- Review your scorecard weekly and take action where needed.
Anything off-track should be questioned for discussion and solved at the root.
- Polaroid — The new I2 adds manual controls.
- 3 Balls — Learn one of my hobbies, how to juggle.
- Nebula — It’s time for outdoor movie night.
Until next Wednesday, take an audit of your scorecard to start tracking and using data that drives your business forward.