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Letters to a Young Manager

Counting the Simple, #15
LTYM > Measurement

Dear Sophie,
What to measure? Good question. For IT we often jump to things like up-time percentage and code completed. But the first question should be "what's the business need?"

Back in the time-sharing days, we had branch offices whose #1 goal was to grow client revenue. It's not different from most sales organizations today, inside and outside the technology sector. Except IT doesn't typically generate revenue. Clients' use of the systems generate revenue. What we noticed was when our consultants worked face-to-face with customers, customer usage went up, and therefore revenue went up. When you talk about business issues and help customers get solutions, your revenue should increase. So IT consultants were revenue influencers.

What we did was start tracking face-to-face visits. As each consultant completed a call, they stopped by my office door and recorded the call and their name on a calendar we posted there. Our goal was to double client visits. And we did it. We also grew revenue that year by 50%. So it worked! but the key was finding the right measure, of a driver we could control, and then a relentless focus on it.

Two other factors made a difference: the measure was public, and it was real-time. Everyone could see where we stood everyday, as it happened. The competition to deliver the most calls also came into play. Last point to notice, this was pretty low tech, a paper chart on the door.

We won the president's club competition that year, which you can read about in the "Wine Bet". A very happy ending for a rather mundane metric. But that's the point.



Increasing client contact with good, helpful people, increases sales

Discussion Questions:

1) What metrics do you use to track success?
2) How do theses measure impact corporate goals?
3) What would you change about the above approach?

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