A vital part of any Business Intelligence (BI) program is the utilization of metrics. At their core, metrics are any measurement used to quantify performance such as return on investment (ROI), revenues or the rates at which customers arrive, remain, and leave the organization.
Key data gathered by metrics is usually designed to help you determine:
- If your BI is working
- Whether change is needed
- Where change is needed
- If that change will effectively impact both your organization and its BI
Gathering all this data is important. Even more important is actually having all the departments of the organization use it to effect change. Real change, when and where it is needed. Without the buy-in from the key participants whom affect your processes, metrics and your entire BI may be pointless.
Determining What Metrics You Want to Use
Before you implement a BI program, determine what information you want measured and how it should be measured. For example, if your organization is launching a new course category, you might want to measure how well similar courses are selling against a competitor’s course or similar courses you may already offer. Or possible, how many inquiries you receive from customers about the new product.
BI metrics can help you measure the impact this new launch is having on your company and then see where improvement or changes might be needed. Another benefit of using metrics is to see if performance outcomes actually align with the goals you have set. It is always important to determine these goals before launching new metrics. Otherwise you won’t know if the current performance levels are below, above or on target, and you won’t have any idea of the actual outcomes you want to measure.
Too Many Metrics vs Too Little Metrics
For some organizations, measuring every aspect of their organization is important, while others only measure outcomes that might have an impact on their strategic objectives. One problem with using metrics for every single aspect of your company is simple: Too much data can weigh departments down. In turn, efforts may waste money, waste time and provide ineffective results.
Metrics should add value to the organization. They should serve as measurements of what is working and what is not so they help facilitate change where it is needed.
This does not mean you should skimp on your metrics either or only use them to achieve strategic objectives. It is also important to use operational metrics to ensure that company processes are working effectively. For example, marketing and advertising your new course to customers might not seem like it is metric worthy, but what if the lag time between marketing and receiving registrations takes longer than expected? What if this lag time causes courses to be cancelled or customers to seek out an alternative competitor? These would be organizational metrics worth measuring.
Additionally, different departments of an organization might have different BI needs, resulting in different metric needs. It is essential to gather input from all the departments in your organization first to see what information is most vital to them and what is not. This way you ensure that your BI program is working for all, and can tailor your metric dashboards accordingly for each department.
Unfortunately, there are no shortcuts in creating metrics, but if you remember to follow a few simple steps and ask the right questions, you can implement a successful BI program that delivers on metrics you and your organization can use.
- Do I have a strategy for my metrics?
- Do the metrics provide quantifiable data?
- Are the metrics easy to implement and easy to understand?
- Do I have buy-in and participation for all departments?
- Are the metrics effecting change?