As a CEO, you want results. To support your lofty goals, you’ve run a good strategy session; and you have a solid plan of attack. But, do you really understand the journey from your strategic plan to your desired outcome? Are you ready to use the single best tool you’ll ever have, the little understood key performance indicator, or KPI?
Almost every growth plan starts out with a strategic planning session that ends before the real work is complete. Once insights are gathered and strategy is nailed down, everyone wants to jump right to execution. No wonder the end results often don’t match the expectations!
For the execution phase to deliver consistent and predictable results, there’s a final step required at the end of the strategy process: understanding the Journey to Success. Marketers map this out all the time with their funnels, so this shouldn’t be an alien concept for your CMO. However, for it to work across departments, we just need to understand the Journey to Success KPIs across all the functions involved. Of course to do that, we need to understand and use KPIs correctly!
So how can you use KPIs to kickstart your performance initiatives?
First, a deeper understanding of the essence of a KPI – simply put, they are like your headlights – they are always forward looking, and represent your focus on what’s ahead, so you can get to your destination.
Let’s use an analogy to make this easier to understand: In a car race, distance travelled and speed, though important measurements, are not KPIs. Instead, KPIs would be along the lines of engine temperature, oil pressure, fuel levels and the like. Though KPIs forecast an outcome, they do not measure progress to an outcome – again, like headlights!
With that in mind, it’s time to reconvene the strategy and execution teams and map out the Journey to Success, in terms of KPIs. Chief marketing officers – already adept at mapping out progress-oriented measures, like the stages of a sales funnel -- can be great facilitators for this type of session. The goal of this exercise is to identify the actions or activities to be measured that will indicate the forward progress of our strategic plan towards our preferred outcome.
Examples of the types of KPIs that can be measured:
- For marketing, it might be unique website visitors, social engagement, organic search, etc.
- For sales, it might be meetings scheduled, rate of new contacts, existing client engagement, etc.
- For customer service, it might be reported issues, time to resolve, first contact resolution, etc.
KPIs that are easy to understand, and can be measured as a single number, are a great way to align cross-functional teams and the entire company. Long sales cycles and complex new business launches are more easily understood and engaging for your entire team when broken down into phases with simple-to-understand KPIs for each phase.
Your CMO can easily design a nice infographic-style KPI dashboard. A good KPI dashboard can serve as more than an alignment tool (and a way to celebrate successful outcomes); it can also be used with your weekly management team meetings and as an instrument to report on the company’s activities to its board of directors.
Just get your CMO to translate your KPI list into an elegant and real-time graphical dashboard, distribute to your team, and you’ll be amazed what happens!
When you map your Journey to Success in proper easily measured and understood KPIs, you’ll significantly improve the predictability of your execution phase.