Metrics to manage and improve your business

Using metrics to get better

Peter Drucker, still regarded as the father of modern management, was a writer, professor and consultant. Born in Vienna in 1909, he died in 2005, yet he still challenges us with many valuable lessons.
One of his best-known quotes is “If you can’t measure it, you can’t manage it.” It captures how hard it is to manage anything without a metric, without a clear, objective, thorough and scientific understanding of everything that can affect the final result.
And nearly every quantitative market and opinion study aims to measure something, whether satisfaction, rejection, preferences, propensity to buy, message comprehension, organizational climate or any other hypothesis.
The problem is that the complexity of products and services, markets, competition, technology, ongoing change and its impact can hardly be explained by a simple percentage of “yes” or “no” answers, or by how many people gave a “10” or a “0.”

Moving past the obvious

We increasingly need new metrics just to reach a minimally satisfactory understanding of the situations we analyze, and that calls for more “creativity” and “originality” in finding the best way to measure whatever we’re investigating.
Personally, I’m fascinated by every new metric that helps explain what we’re evaluating, and at the same time it bothers me no end that I didn’t think of those approaches myself.
The fact is that once they’re in use, good new metrics become indispensable for decision-making, and you start to wonder how anyone ever made decisions without them.
One of the sources of inspiration I find most interesting when it comes to metrics is professional sports, mainly because their indicators have to be clear, easy to understand and instantly readable.
But what’s most exciting is that these more “sophisticated” metrics already point the way to solutions, showing how to solve problems or make the right business decision.
Watching a volleyball match today means diving into metrics for every skill (serving, blocking, passing, setting) and how they evolve throughout the match: top scorer, number of aces, best defender, number of blocks, hitting efficiency, reception, best setter and more.
Even soccer, almost always a slow sport to modernize, now includes stats on shots on goal, scoring chances created, distance covered by each player, heatmaps of player positions, ball possession, fouls committed & suffered, misplaced passes, offsides, corners and more, all of which make it easier to see and “understand” the game.
Tennis, in particular, is a sport where “new” metrics are constantly being created that do a better and better job of explaining player performance, match results and the quirks of each tournament or court surface.
Winners, unforced errors, service breaks, first-serve points won, ball and serve speeds, points won in rallies of more than 5 shots, points won at the net, where serves landed in the service box, how shots were distributed across the court and more are now available in most broadcasts, something that didn’t even exist a few years ago.

The gold standard for innovation

But for me, basketball, and the NBA in particular, is probably the pinnacle of sports metrics, for their variety, their creativity and their constant evolution in the search for what explains the performance of games, teams and players.
Beyond the basic stats (passes, field goals, free throws, three-pointers, rebounds) that fans have followed for a long time, the new measures being “invented” offer a much more holistic view of the game.
Triple-doubles and double-doubles (when a player reaches double digits in three or two categories, such as 10 or more points, assists or rebounds), together with minutes played, bench scoring, turnovers and other metrics, add a whole new dimension to the game and to the strategies coaches put into practice.
Commentators always have comparisons at their fingertips, with historical data, past seasons, stats for other players (active or retired) and other franchises, and it’s an incredibly rich source of material to support any “decision.”

A restless pursuit of precision

The lesson for anyone working in market and opinion research, or in the search for insights, is that we must always keep an open mind to new opportunities, to possibilities that exist but haven’t been noticed yet, and to what technology, software, artificial intelligence or anything else can offer to better explain the problem at hand, whether it’s a new product or any other situation.
This constant restlessness, this relentless search for new, different, creative and innovative ways to measure anything, should be a concern for everyone in our field.
To arrive at more precise, rigorous measurements that better explain behaviors, choices and perceptions, simply repeating familiar formats or comparing with historical data should never be enough.
Today, technology makes it much easier to “search,” “handle” and “work with” primary data, as long as you’re willing to “dig” deeper, to cross variables that seem unrelated, and to compare the results with other secondary data or (especially) with past studies.
It shouldn’t be enough just to measure today’s satisfaction score. We should ask whether it changes with how long people have been customers, whether knowing a competitor’s products affects the score, how much users’ demographics show up in it, whether new players entering the market are reflected in the metric, how much familiarity with digital and technology matters, and so on.
So the most important thing is not to get complacent, and never to settle for traditional, well-worn metrics that can’t always explain the changes underway or, worse, don’t offer enough clues to build the solution we’ve promised our clients.