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It’s Not About The Metrics! It’s What You Do About Them!

We seem to be metric crazy. Every organization I meet has a whole alphabet soup of metrics. Terms like ACV, MRR, ARR, TCV, LTV, CAC, Churn, Retention, Bookings, Revenue, Quota Attainment, SQL, MQL, Conversions, ATV, Win Rates, Velocity, Customer Growth, Product Growth, Share, Onboarding Time, % of people at quota, Voluntary/Involuntary Attrition, CRM Utilization, Pipeline Loading, Account Planning, Dials, Appointments, Proposals, Customer Meetings, Demos, Time spent per call, Number of questions per call, Types of questions per call, on and on and on. Vanity metrics like number of cups of coffee a day and time spent in the bathroom per day are the next to come into vogue-we must be able to find some connection to performance through those.

We measure everything we can. We track those measures over time, seeing whether they go up or down or remain unchanged.

Our computers are filled with dashboards, we post key numbers and charts on the walls of our conference rooms. We are all about the metrics and numbers!

But what do they mean? What’s behind the numbers? What happening that creates these numbers? And most importantly, what do we do about them?

I’m stunned by the number of organizations I work with that are “numbers/metrics” focused, but do nothing about them!

Recently, I sat with a group of very talented sales leaders. They had been doing reasonably well, but they were trying to figure out how to drive growth.

We walked through a number of very elegant dashboards. One metric caught my eye, it was a very interesting pipeline quality metric. It showed they have a pretty significant pipeline quality issue. I asked if they could show me more about that. “Click, click, click,” a few keyboard strokes and I could see the three year history of that metric.

Surprisingly, it had been about the same, every month, for the past few years. I asked, “What are you doing about this? Why hasn’t it changed? It’s should be 15-20% of what you have been experiencing. This has a significant impact on the quality of your pipeline and the quality of the opportunities your people are chasing……”

They looked at each other, then at me. While they had been measuring everything, the metrics became ends to themselves. They had missed a critical link:

Metrics are only a means to identifying performance improvement opportunities. They aren’t the end, they are, in fact, just the beginning.

Most of the organizations I work with, unwittingly, have fallen into the same trap. New tools and technologies enable them to measure more than they have ever been able to measure in the past. The metrics enable them to gain deeper insights into performance issues, they provide managers the opportunity to identify performance leverage points.

But by themselves, they are meaningless. We have to get into the metrics to understand what they mean, what were the things that contributed to them being good or bad? What actions do we need to take to improve performance?

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