• Donald Davis

The One Metric

If I were to ask you what single number is most important to your business what would you say?

I have heard in the past the following:

  1. Revenue: if customers are paying their bills then the business must be operating well.

  2. Customer Satisfaction: it will tell us if customers are satisfied with us and if they are satisfied they will pay.

  3. Margin: because it tells us the balance of revenue versus cost.

  4. Employee Satisfaction: if your employees are satisfied they will satisfy the customer.

My belief as a business leader is that this is a trick question. The only answer I can give is that it depends on where the company is in its lifecycle. There are times when all of the above are important.

To answer this question I would need the following information:

  1. What is the vision and strategy of the company? Is everyone driving in the same direction?

  2. What are the Goals, OKR’s or KPIs that everyone is measured by?

  3. Are there annual targets?

  4. Are these targets broken down to the individual level so that each department and person knows what they are aiming for?

  5. Now, is it possible to measure success by just one number at a high level?

In a previous organization, we designed what was known as the tower report. It would allow any leader to start at any level and either look at the rolled-up number or to drill down into lower levels to see the items that make up the number.

Now I come back to my original question, what single number is most important to your business?

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