How does your company measure success? How do you ensure that you and your team are focusing on the critical levers that drive your business? Many companies focus on sales, expenses, headcount and other outcomes -- they are the result of a large number of key business processes that drive your company. In effect, these measures are lagging indicators of decisions made in the past. How do you determine the leading indicators that actually drive results?
I always ask new clients what their company's "hot buttons" are. These are the 2-3 key levers that drive everything in the business. Of course, many important metrics should be measured on an ongoing basis -- but there are only a few that are crucial, make or break items that determine success or failure. As you can well imagine, every business has its unique hot buttons, particularly given the current state of the company.
These are the 3 most effective techniques for identifying hot buttons.
1. Taking a new perspective
One of the greatest gifts leaders can give to their team is a pair of fresh eyes. It's extremely difficult for those who are deep in the details of the company's daily operations to see the big picture or look at their work objectively. Taking an outside-in perspective is essential to uncovering these nuggets.
Working with your team to identify these hot buttons can be an intense process -- probing, examining, questioning, evaluating every aspect of your company. Asking questions such as "Why is this critical?" "What happens if we don't do this?" "What happens to our sales if we invest in quality?" or "What happens if we raise or lower our price 10%?" really force you and your team to learn the essential drivers of your business.
As you can imagine, discovering your team's hot buttons will also equip you and your employees with the necessary tools for improving inefficiencies and creating solutions to problems there were never even considered. It can help you reevaluate your whole system of operations.
2. Process Mapping and Data Analysis
Company's consistently make changes to rules, policies, practices, systems and other components of their business model. While each individual piece might seem to be working, often times the complete process may have problems.
I recall advising a company several years ago whose CEO complained that it took 3 months to onboard new clients, which appeared to be an outrageously long period for what should have been a non-complicated process. By speaking with employees, mapping out each process and analyzing lots of data we learned something quite interesting. Each department was tracking the time of its own process but was not tracking the quality of their work. In addition, there was no one in the company who was responsible for either the time or quality of the overall on-boarding process. We learned that most of the 3-month time frame was either related to fixing problems in other units, or long waiting times between units.
Doing this work enabled us to fundamentally redesign the process and reduce the on-boarding time to 3 weeks, making both employees and more importantly customers very happy.
3. Engaging with Your Employees and Customers
This is where the action is, and it's often the most neglected. It takes genuine interest to obtain this information, some of which might be negative; it takes time that could otherwise be spent doing something else; and when you get the information, you really need to act on it. Let's remember that your front line employees are dealing with your customers and you want to hear from them as to what they think. And the most successful leaders want to know what their customers have to say.
I interviewed Tom Hale, the founder, and CEO of Backroads, the largest and most successful active travel company. When I asked him if he had "hot buttons" he told me that customer evaluation of the trip leader's performances was by far the most critical variable. He and his firm measure everything and do extensive analysis of what is critical vs. what is nice to know. He discovered early on that customer satisfaction is most heavily dependent upon the employees that lead these excursions, and therefore most responsible for the quality of the guest experience. As a result, "leader performance" is now one of their most important metrics.
Hot Buttons is about focus. Once you have finalized your 2-3 key metrics, let everyone in the company know what they are, and why they are so vitally important. Use every opportunity to keep talking about them so that everyone understands how important they are to you, your employees and your customers. You will see the positive results of this intense focus very quickly, and your overall business performance will improve substantially.