Now imagine this.
You’re the captain of a battleship. You’re responsible for the safety and well-being of your entire crew.
Now imagine your ship is in battle and you have no command center giving you visibility of whether or not your ship has been hit until 30 days later, nor visibility on whether enemies are behind you or in front of you. What do you think will happen to your ship?
You sink.
If you don’t have that command center and those metrics easily available and in front of you, you’re dead. The same applies to your business.
On Shark Tank, you probably see us constantly asking contestants about their metrics. In order to make investment decisions, we need access to and understanding of several metrics, such as current sales, the cost to acquire new customers, conversion rates and so much more.
Whether you’re seeking funding or not, though, you need to track your metrics in order to identify your strengths and weaknesses, and ultimately maximize your success.
For the past two years, my team at The Shark Group has worked with Guiding Metrics. Guiding Metrics creates dashboards that automatically track our key metrics, and this makes metric gathering so much easier so we can figure out what our next move is based off of all this info.
Here are five reasons why you should track your metrics:
- Tracking Metrics Makes It Easier to Run Your Business
Looking at metrics allows you to quickly tell how each area of your business is doing. Are sales up? Then your sales team is performing. Are leads down? Then your marketing squad has work to do. Are products being delivered on schedule? Then your fulfillment team is on track. And so on.
When you’re able to view and analyze key metrics, it makes it much easier to run your business. You know where to invest your resources, and you focus on the most critical issues.
- Tracking Metrics Improves the Performance of Your Employees
Most employees have a hard time knowing whether they’re doing well or not. Worse yet, many think they’re doing a great job when they’re not.
Metrics give employees a transparent scorecard. They tell them if they’re doing well or not. For example, if your marketing manager is responsible for driving traffic to your website, they should own the metric “website visitors.” And once they own it, and can see their performance, they typically perform better. Much better. With access to metrics, they are able to set goals, but are also held accountable for those goals.
- Tracking Metrics Quickly Shows You Problems
This happens all the time. A company reviews results at the end of the month only to realize sales declined. If they had their “command center” and had been tracking other key metrics, such as number of leads, they would have noticed three weeks earlier that new leads had decreased. They could have fixed the problem earlier and had a solid sales month, but because they didn’t track this metric, performance suffered greatly.
- Tracking Metrics Helps Your Company Focus
By selecting and tracking certain metrics, you can ensure your whole company focuses on the right things. Do you want to be known as having the best customer service in your industry? Then track multiple customer service metrics such as returns, response times, and customer satisfaction surveys.
Rally your team around key metrics to get everyone pushing in the right direction.
- Tracking Metrics Allows You to Methodically Improve
We’ve all heard the phrase “you can’t improve what you can’t measure.” If you aren’t tracking a metric, how do you know if you’re improving? Conversely, if you are tracking it, you can methodically improve over time.
Tracking your metrics makes it much easier for you to grow a more successful business. By using a metrics dashboard, you can automate the process of compiling your metrics, saving you and your team precious time.
