Use this framework to monitor your business growth!
August 26, 2014
Take a look at the chart. This is from Google Analytics for our website for July this year compared to the month before. The numbers aren’t exactly something to write home about, what with only 383 users and 2,040 page views. Yet, I am happy because it tells me that what we have been doing over the past month has been paying off. With the exception of “New Sessions” (Google-speak for new visitors to the website), all the other perspectives are green, which means that it has improved over the month in comparison with the previous month.
Why is this important for us? With a strategy of growing our Google ranking organically, and not paying a single cent to get to the top of Google, seeing these metrics tells us that we are on the right track. And what are we doing to get there? We are publishing original content daily onto our website, and making sure that it is relevant to our target audience. We are also sharing these on social media so that it gets greater traction.
It’s about metrics
This post is not about Google Analytics. Instead it is about metrics in general. How do you know what you are doing is impacting your business in the right way? And what should you do to improve your results? These are fundamental questions that all businesses need to ask and answer.
The Balanced Scorecard
But what metrics make sense to a business? If you are an established company, you should be using Balanced Score Card (BSC). BSC is a scorecard quite like Google Analytics but one for businesses and looks at four perspectives: financial growth, customer satisfaction, operational excellence and organisational learning. For us, we include two other perspectives for our clients: employee satisfaction and environment/sustainability. Obviously, under each of these categories, there will be a host of indicators that you can use to measure where you are, and also uncover what you need to do to get to where you want to be. To get at these indicators, you will need to start at the key results that your company wants to achieve for the year, and translate them into key indicators for each of these perspectives.
When you are a startup, you may need to define different perspectives in your scorecard. Customer satisfaction and operational excellence must stay, and financial growth may be changed to customer growth. Organisational learning should give way to operational learning and what is tracked will be the number of Learning Launches (see related article). We don’t really need to track employee satisfaction and environment/sustainability in the beginning, but as the business grows, this will become important.
When I look at my Google Analytics, I know I need to continue doing what I am doing. In the area of New Sessions, I will need to get more people to like our Facebook page and also update our company LinkedIn profile. Both of these will have the means of helping me increase visitorship, and that will help me improve that last score. These are concrete actions that I can take.
Likewise, when you look at your own scorecard, you must be able to identify the specific actions to take to increase your score. If you don’t know how they are calculated and what constitutes each perspective, chances are you will not be able to impact a change. And then the whole point about metrics will be moot. Metrics are used to ensure that you make the right changes at the right time, and not get side-swiped by a catastrophic event that could have been avoided.
Set it up now!
Of course, if you want to monitor your website performance, you must first have Google Analytics set up for it. In like fashion, if you want to monitor your business performance, you must have your BSC metrics set up. Otherwise this discussion is really just that – all talk!