Be careful what you measure – you may not get the results you’re expecting.
A few years ago, part of the UK health system wanted to reduce the number of cardiac deaths. They decided ambulances should get patients to the nearest hospital as fast as possible.
Sounds good in theory. The faster you can perform CPR, the better the chances of survival.
But it didn’t work out that way.
Reviewing the results after a couple of years, death rates had significantly gone up.
Getting patients to the nearest hospital might be efficient – but not effective. It was preferable to take longer and get them to more distant hospitals which provided specialist care, dramatically improving survival rates.
The analogy equally applies in business leadership.
What KPIs are you measuring?
Take sales prospecting.
I know of sales managers who expect individuals to make 40 to 50 calls per day. Spray and pray. Hoping to get meetings.
They think this is efficiency. But is it effective?
How many of these calls turn into meetings? And how many of these meetings are with the right people? In my experience, some people can’t say no – so they book in the meeting and then either don’t show up, or string you along.
Sales conversion rates. I’d much rather you contact 10 people a day who are in your target market and book fewer meeting with prospects who have an issue you can solve and are willing to take the next steps.
Revenue versus profitability. Revenue is vanity – profit is sanity. Keeping track of your sales margins and acquisition costs. Repeat business per client.
Given this, what are you measuring?
