Link Search Menu Expand Document

Mistakes to avoid when assigning ownership of metrics

Here are some mistakes to avoid when assigning ownership of numbers.

Here are some mistakes to avoid when assigning ownership of numbers.

Giving ownership to inexperienced team members

Don’t assign ownership of meaningful metrics to inexperienced team members. They don’t yet have the experience to make them move correctly. Furthermore, in the interest of hitting their targets, they’re likely to abandon the process. You can use them as examples and for training and assign them indicative but not crucial numbers. However, you cannot expect them to deliver or to be instrumental in developing your processes.

Metrics that aren’t specific enough

If there is a misunderstanding on what the targets mean, expectations can be wildly different.

Metrics that don’t mean much

Two potential mistakes here: metrics that are correlated but not causative and vanity metrics.

Tracking correlated metrics might mean you’re trying to affect a metric that only tracks another. It’s an indirect indicator of success but not its driver.

Vanity metrics look nice but aren’t an incomplete indicator of the company’s health.

Not tying metrics to steps in a process

Measurements, and targets, should cover each step of the process and not just the result.

Optimizing the process involves optimizing each step and ensuring minimum drop-off between steps.

Unrealistic

Unachievable targets are demotivating. They are also bad indicators of a person’s performance.

An exception to this rule is a target that is unachievable in retrospect. You may choose these targets when you first start tracking something simply because you don’t have a point of reference.

Targets that cannot be controlled directly

Targets that they either cannot control directly depend on other factors can also be frustrating.

For instance, having to depend on another department while their targets are not aligned with your goals.

Unilaterally setting them

There’s no point in anyone setting them unilaterally because there is rarely an entirely isolated target.

Looking at targets in isolation

Almost all targets affect and are affected by others.

For instance, sales might have hit or exceeded their targets one week, but marketing had a successful marketing campaign at the same time.

Not tied to a goal

It’s crucial that you clearly define the goal of the target. Not only is must the target be hit, but the spirit of the target must be fulfilled as well.

Increasing the number of suppliers is a frequent target. However, just increasing the number is insufficient. The goal that this is in service of must be clearly defined.

In the beginning, this is likely to be only an increase in catalog variety. Later, however, this target must be qualified better. For instance, the goal might be to improve the product spread between categories. An even more specific qualification might be to increase the number of products in the “Cleaning” category.

Targets that can be influenced too directly

Targets that people can change themselves are meaningless.

For instance, tracking marketing spend or the number of loyalty points spent. These numbers can be changed by the team directly.

Not having a complete set of metrics

You cannot represent your business by a single number.

There must be an entire set of metrics that represent various aspects of the company’s health.

These numbers must cover the performance of each department. That performance must then relate to the financial health of the company.

Not taking into account quality

Targets that do not take into account the quality of the result are often misleading.

For instance, targeting just the number of suppliers can be deceiving. They may be unsuitable suppliers that don’t even finish onboarding. Or there might be ones that have products that aren’t selling. Or in categories where you already have good coverage.


Suggest an improvement to this page (me@ognjen.io)