Do you have enough gas to get there?

Measuring progress is something that has been on my mind a lot recently. I've been looking at a couple of different businesses that don't really measure very much about themselves other than their revenue. To me this is sort of like measuring a car trip only by looking at your speedometer. You might be ignoring things like: Are you on the right road? Are you getting closer to your destination? Is your engine overheating? Do you have enough gas to get there? All of those things are important, but so many businesses don't do a very good job at measuring them.

I'm a big fan of metrics and I know it will make me sound like a huge geek, but I love to pick apart systems and figure out how they work and what could make them work better. Yesterday I wrote about some lessons I learned in my career. In a recent post about how to measure your growth, (Size Matters--part 2), I talked about some specific metrics to gather and how to incorporate those into a feedback loop to refine the process of growing your company. Both of those posts are really about the same thing: Tweaking your systems to achieve the results you want. Today I wanted to just mention a few other ways to measure your performance.

Win-loss reports

After a sales cycle, you should do a win-loss report with the customer to figure out why you won or lost. You are making a big investment in sales and marketing. Why would you continue to invest in something if you don't understand the return? Win-loss is the best way to understand this.

Project post-mortems

After an implementation or software development project, do a post mortem. What helped your project? What hurt it? How good were your estimates of time or resources needed for different tasks? Why were they incorrect? How can you improve next time? No matter how well, you think you are doing, there is always room for improvement.

Employee Reviews

Do you conduct annual employee reviews? Most high-tech companies spend a very large portion of their annual budget on people. In addition to your other systems, you can tweak the performance of each individual. Have their managers work with them to figure out what they are doing well and where they need improvement. Give them some feedback.

Audits

There are a lot of different kinds of audits: financial, security, tax, etc. Do you do them just so you can comply with regulations? Or do you use them to understand where your problems are and figure out how to correct the problems? Audits are a great source of real data.

Often looking at data generates more questions than it answers. If that's the case, don't reject the data as useless, figure out how to get the data you need and then continue. Don't let that stop you.

Also, remember that you don't have to have all of your measurement systems in place to show improvement. It takes time to build up to a place where you are able to do all of these things effectively. If you can't do a full post-mortem of your project this time, take your team to lunch and spend 30 minutes talking to them about what went right and what went wrong. Any data is better than no data.

Constant improvement depends on understanding your process, figuring out how to measure your success or failures and then modifying your process to achieve better performance the next time you go through that process.

What sort of things do you measure about your business? How do you use that data to improve? I'd love to know.


photo credit, mbylow