Effective metrics drive the results you want

This week I attended the Gartner Security & Risk Management Summit in Washington, D.C.  I attended a lot of very good sessions, but the one that left the biggest mark on me was a session called "Metrics That Matter," delivered by Jeffrey Wheatman.

I went to this session because I've had a lot of conversations with information security executives this year, and a common question is "What should I really be measuring?," or they make comments like "I report on a lot of things, but I am not sure what the top indicators are that I should roll up to my executive team."

My initial reason for attending this session was for my "day job" as the CTO of a tech company, but I feel like I can "generify" Wheatman's guidelines to apply to anything that needs to be measured & tracked.

1. Effective metrics must support the business's goals, and the connection to those goals should be clear.
2. Effective metrics must be controllable. (In other words, don't report on things that "just happen" - report on things you can drive up or down with your own, direct actions).
3. Effective metrics must be quantitative, not qualitative.  If you need to measure something "softer" like customer satisfaction, find a way to make it quantitative, such as with a method like Net Promoter Score.
4. Effective metrics must be easy to collect and analyze. (Wheatman says "If it takes 3 weeks to gather data that you report on monthly, you should find an easier metric to track.")
5. Effective metrics are subject to trending.  (Tracking progress and setting targets is vital to get people to pay attention)

This set of guidelines really resonated with me, and I am going to run my metrics through this regimen to make my own metrics better.  If you're a Gartner client, there is a detailed research report from Wheatman on this topic, and I suggest you grab a copy.

I've also learned that it helps to simplify how you report on metrics.  When dealing with executives, stick with small numbers and primary colors - and when you get senior enough, try to boil it down to up/down, happy/sad.

What about you - do you have any best practices to share around metrics?  Could you apply these to your own individual metrics or self-improvement goals?

Accountability and granularity

Lately, I've been involved in a debate about accountability  What's at the heart of the debate? Clarity regarding how much detail is required  for someone to feel like they have enough information to hold another person accountable.  

In my particular debate, the question revolves around accountability for some longer term goals.  The person making the commitment, let's call them Mr. Committer,  has made some bold declarations (more directional in nature, although there are some measurable aspects that are clear enough to give a "pass / fail" grade).  These declarations won't be complete for at least a year.

Starting with these bigger picture goals, Mr. Committer created a sort of "work back" list - in other words, they began to break the larger commitment down into smaller steps and arranging them in a sensible order, to create an execution plan.

When this person presented their plan to two other people for review, there was a lot of consternation from one of the managers (let's call her Ms. Stickler) along the lines of, "Hey, I don't have enough here to hold you accountable," or "I don't know what to hold you accountable for."  

Break down the breakdown

As we began to disect the situation, we discovered that the issue was primarily one of detail:

• Ms. Stickler wanted a fully-fleshed out plan with way more detail than had been presented.
• Mr. Committer complained that he wanted to be held accountable for his results - the "big commit" - and not the specific steps followed to achieve the results.
• Ms. Stickler asked, "How can I hold you accountable over the next few months if I don't have a specific set of steps you'll be following?"
• Mr. Committer retorted, "A lot can change as I learn along the way and I don't want to be locked in - how can I innovate with you bearing down on me about specific steps so early in the process?!?"
• and so forth…

Shift the focus

So how can we break this conflict?  In our case, we are trying to focus less on the detailed steps along the way and, instead, have been brainstorming some interim indicators that must be met regardless of the detailed steps we choose to follow.

This, in itself, is still a difficult discussion, but it is far more productive (and far less stifling) than a debate about what specific steps will be taken.  In other words, I think we've successfully shifted the emphasis away from the activity, and toward a focus on the desired results.

This transition has been difficult, because we are fighting human nature and personalities in the process (detailed/control-oriented personalities vs. big picture/don't micromanage me personalities).

Any tips or techniques I can steal from you?

I'm sure we didn't get to this point in the easiest way possible.  Have you seen this kind of situation before?  Have you cracked the code (or at least come up with best known methods to make this easier)?

I'd love to hear your proven techniques for dealing with this kind of issue - please share!

Sharpen your saw with THINKBook

A while back, I bought a THINKBook, which was developed by my old friend Rajesh Setty.  The problem?  I got busy and forgot I had it, so I just got around to using it a few weeks ago.  I am very impressed with this unassuming little notebook.

What the heck is a THINKBook?

In simple terms, a THINKBook is a hard-bound red notebook, about the size of a Moleskine notebook.  But it's way more than that; sure, it has ruled paged you can use for writing, but it is more than just a general purpose notebook.. This is a thinking person's journal, for challenging your thinking.  

The thinking challenges are framed by "prompters" on various topics interspersed throughout the THINKBook (see the example on the right).  There are a bunch of topics relevant to both business and personal introspection, and I like them very much.  Full disclosure, I didn't think I'd like them at first, but I surrendered to the process, tried a couple and found that they were very useful.

The structure of the prompter exercises in the book really pushes you to think at a fairly deep level, and definitely promotes "out of the box thinking."  It feels very soothing to follow this process and begin writing journal entries in the THINKBook - this is all about crystallizing your thoughts and devoting some time for your own improvement.  That's something a lot us us don't take time out to do, and I think we'd all be better off with some periodic deep thinking.

Spread the Thinking

I really like one of the suggestions from the THINKBook web site, which is to use the THINKBook as a personal and professional gift.  I particularly like the thought of giving it as a business gift, and I just may try that to see how people react.

I like the framing of the "why" behind the THINKBook, according to Rajesh:

THINKBook makes it easy to pull your people’s own best advice out of them. It can be used to super-charge group brainstorming sessions or as a trusted advisor to help you improve the brilliant idea keeping you awake at 3am.

Pretty cool, don't you think?

If you could use some time working on your own creativity and mental health, I encourage you to  grab a THINKBook and give the process a chance.  And, if you like it why not give one as a gift to someone you like (a new one, not your old used one)?

"Brand Real" - does your brand pass the test?

Laurence Vincent's book, "Brand Real," is all about brands and brand loyalty.  At first, I was wondering how much of it would apply to me - after all, I'm more of a technical guy, and I'm not in charge of a big brand.  I found that there were actually a lot of relevant take-aways from this book that I could apply in my daily life.

"Brand Real" not only helped me understand what it takes to build a good brand, it also helped me think differently about some of the brands I have a fondness for (and some that I don't), in that it has a deep discussion about why leading brands create loyalty within its customer base.  In essence, this book spends a lot of time on analyzing brands that have become "sticky" based on what they do and not just whether they have a cool name or an exciting logo.

At its core, this book's discussion of "brand" reminds me of the maxim, "You become know for that which you consistently do."

Lots of case studies

I love learning by examples and through story-telling, so I was pleased to see that this book has a lot of real-world examples to illustrate some of its concepts.  These stories range from the personal, such as a discussion between the author and his son illustrating how superficially we think of the notion of a "brand;" and corporate-oriented stories, such as how The Gap triggered a huge backlash amongst its customers when it tried to change its logo.

Other examples feature Apple, Starbucks, and other household names, as well as case studies about lesser-known (but perhaps even more informative) organizations like Washington Federal.

Thinking of brands as living things

One thing that stuck with me in this book was discussed in a chapter called, "Expressing the Promise."  The author describes how researchers Robert McRae and Paul T. Costa, Jr. found that all people could be measured based on the degree to which they possessed 5 key characteristics:

• Neuroticism
• Extroversion
• Openness
• Agreeableness
• Conscientiousness

Likewise, Vincent posits that brands can be measured along 5 similar axes - think of them as the "personality of the brand":

• Sincerity
• Excitement
• Competence
• Sophistication
• Ruggedness

These attributes play a key role in measuring, defining, and even redefining your brand.  In "Brand Real," Vincent discusses how to use these to develop your messaging strategy, as well as how to "test" your messages to determine whether they are congruent with how your brand behaves.  Then, you can use these anchors to map what you say, what your brand does, and who you're talking to (your audience or customers) to make sure things all hang together in a credible way.

The third rail of brand

In much the same way that the third rail on a subway system provides the power that enables the train to move, Vincent talks about what it takes to connect your brand to the heart - the emotional side - of you customers, which is really the key in making a brand that customers feel passionate about (and loyal to).  These are the brands that go beyond functional products and capabilities, and move into something that makes embeds itself in the lives of its customers to create strong, emotional loyalty.  I think of brands like Apple, Nike, and Coca Cola when I think of this kind of brand.

I'm just touching the surface of the depth of this book, as it relates to brand.  I think all of the concepts apply to anyone involved in branding and company reputation, but I was surprised at how many of the concepts can apply to our personal brands.  I can see how many of these concepts could be used to improve your perceived value at work, home, organizations in which you're involved, etc.

So, if you have any interest in branding and reputation management, check out "Brand Real" -- it is well worth your time.

Seeing the Big Picture

Last week, I got a copy of Kevin Cope's new book, "Seeing the Big Picture: Business Acumen to Build Your Credibility, Career, and Company." This is a great primer on how to figure out the real way your business works - I'm talking about money and profitability.

I wish I'd had this book a year ago. I work for a company that was purchased by a private equity firm last year, and I've had to learn a lot of new things about the financial aspects of business, as they were thrown at me. A lot of what I learned e hard way is presented very clearly in this book - along with some additional information I'm sure I'll need in the near future. Do yourself a favor and learn about it before you need to apply it.

You see, a lot of us know the basics - "A business should bring in more than it costs to run the business." But there is a lot more beyond that to help us use real data to not only run our businesses, but improve them and make them sustainable and profitable in the long term.

Knowing the key elements

Kevin Cope does a great job of explaining aspects of the business in a very understandable way, whether you've got a financial background or not. The sections include:

• Cash
• Profit
• Assets
• Growth
• People

Each of them is detailed in a way that unfolds very well - each section builds on the last, so you can better understand the relationships between these key elements of a business. He also does a great job of linking them so you can understand the interplay between these 5 elements.

Furthermore, Cope explains how to use and interpret some of the "artifacts" you'll encounter as you dig into the financials of a business, including how to read a balance sheet, how to interpret an income statement, and how to get real meaning out of financial reports.

One of the concepts I've had to learn about through hard knocks is EBITDA (Earnings Before Income Tax, Depreciation, and Amortization) which is a key indicator tracked by the private equity firm that owns my company. Cope explains this very succinctly in the book and relates it to the 5 elements, above.

Not just for managers

One of the things I love about this book is how relevant it is for anyone who wants to add value to the business they are involved in. This will add a lot of value for managers, but it will also help any individual contributor better understand how they can contribute to making the business more effective. In other words, if you want to figure out how and where you can add value to your company's success, this is a great book for you.

Cope also talks a lot about how you can use all of this information to make better decisions about your business - such as how you can make pod decisions about when to save earnings, when to reinvest them in the business, how to look after both short-term and long-term horizons for your business.

If you want to brush up on your financial acumen and learn some techniques to help you add more value to your business, grab a copy of "Seeing the Big Picture" - it's like a crash course MBA.