Having an Unhealthy Metrics Ratio Can Have a Negative Impact On Your Results
We all love metrics. We can’t wait until the latest reporting period is over, so we can start digging into the numbers to see how we did. The anticipation is exhilarating. When things are going well, it is a little bit like Christmas morning. When you are struggling, the metrics are about as welcome as a letter from the IRS.
It is important to be aware of your “Metrics Ratio”. Many e-Commerce teams are responsible for both the execution of activities as well as reporting on the effectiveness of those activities. The Metrics Ratio considers the resources dedicated to driving the metrics versus the resources required to measure the results. You probably think you have much more talent dedicated to driving vs. measuring results. However it does not always work out that way. The demands of the various stakeholders increase over time. Unfortunately you end up running far more reports than originally intended. Resources formerly dedicated to creative work now end up “feeding the metrics monster”. Your Metrics Ratio gets top-heavy on analysis and your performance takes a hit as a result.
What can you do to counteract this? You have a number of options which include:
- Consider relaxing the reporting period. Do the metrics change enough over time to justify the frequency? Can you go from daily to weekly, weekly to monthly, etc?
- Are the stakeholders truly using the reports you are generating? Consider doing a formal or informal survey. Ask your metrics stakeholders how necessary the various reports are to them. Ask them to rank them 1-10. You will probably find a few reporting items you can eliminate.
- Stop “massaging” data before sending out to the stakeholders. Most metrics packages have the ability to schedule “canned” reports that can be pushed to the various recipients on a regular schedule. No manual intervention required. If people want a specific report adjusted in some manner, suggest they handle it themselves or delegate to someone on their team.
- Strive for the “hub and spoke” model. Train stakeholders in using the analytics package themselves so they can generate their own reports.
Reporting metrics are a form of communication, and like all communication rule#1 is know your audience. Some stakeholders will be incapable of generating their own reports, and may overstate the use they get out of the reports. If it is the CEO – you suck it up and get them the reports. If it is some middle level manager – perhaps you make the tough call.
Ultimately you are held accountable for delivering positive metrics, and managing your Metrics Ratio effectively will help boost your results.