I am sitting here looking at my tons of postings, and many of them are talking about big data, data-driven decisions, customer service based on data, and so on.

Nice and relevant!

However, one of the most significant gaps around business today is the lack of skills to analyze data when it is correctly captured. During my career, I have used 5 principles that helped me when working with data:

1- Collect what is necessary: many of us like to capture all data, regardless of how we are going to cross them up later on. You probably have already heard someone saying: “Just give me all the data that you have.” One tool that can help is the Stratification Matrix (image).

2- Make sure that you know what the client or business issue is: when capturing data, we tend to go for what we are used to knowing. Go for the problems that are being faced by clients, shareholders, business, etc. Understand their requirements and use the voice of process breakdown to leverage the existing baseline. Make sure you interact with them whenever possible (image).

3- Put the C Level Suit: Always look for the big picture when understanding data, and its effects in the organization. Make assumptions using scenarios, and always ask yourself: “What If.”

4- Look for the process that generated that data: you probably heard about “walk the talk.” That’s right, and sometimes things can be, sound and look odd. Go to the shop floor, the branch, office, and talk to people. Make sure you understand their execution from a process perspective. It will sure make analysis easier.

5- So What: I love this one. You probably know this (!!), but you will need to recommend some action at a given point, especially after analyzing data. Deeply understand the actual scenarios and think about what are the possibilities that business can go for. Use benchmark when appropriate, and why not try to generate ideas (innovation!). Take the lead; otherwise, someone will, which in this case, your competitor…

If you do not measure performance correctly, you will face failure at a given time. There is no sustainable success without a robust approach to performance management, regardless of the company, nature of the business, or any other aspect.

The truth is that measuring performance takes time and a considerable amount of organizational maturity. Great companies still insist on the mistake of measuring without establishing proper governance which should allow them to deep dive in understanding root causes, which can be done by starting to understand your customer and employee journey maps (How they Buy, How I Serve).

Well, if you happen to do all of that you might think everything will be ok right? Nope, …you will still need to adjust your metrics and move them from lagging to leading indicators.

A common mistake is to use metrics to only tell a story instead of predicting the next one. One good example often used in isolation, is metric client retention rate. Think about it, when you are looking at the data you are looking at the rear mirror. These types of KPIs are called the lagging ones, nice and important but not the most important ones to predict future trends and help you to differentiate your business when facing competition.
The leading indicators, on the other hand, can provide superior information showing us how the future will look. Following the retention rate example, mature metrics aim at the customer MOT (moment of truth) as an order delivered. It is right at that time that the organization creates simple mechanisms, and sometimes even automatic ones to check customer experience.

There are 5 steps that can help you improve your performance management approach:

1- Listen to the Customer (Voice of Customer), find his requirement and put in a measurable scale

2- Be Simple: don’t wait for all the data, sometimes it will be expensive and might not be valuable at all.

3- Be Visual: make sure everyone is aware of results. It brings to the whole organization the sense of urgency which foster improvement.

4- Form leaders as teachers, they are the backbone to put things back on track. They need to quickly connect results of metrics to the strategic view of the company, unit, department…if not it will be vague.

5- Be disciplined on data collection, frequency, and mainly on the actions for improvements. Remember from 0 to 7 is kind of easy…from 7 to 10 is pretty hard.