Outdoor events and the race season are moving into full swing here in Austin after the onset and continuation of some wonderful weather. Even athletes who are not planning to compete are honing their workout routines.
As I was taking stock of my own training plan, it occurred to me that the three key metrics categories we apply in the "sports" arena apply just as well to marketing: outcome, performance, and process.
Here quick definitions of those three categories.
1. Outcome metrics are what we want to achieve
Examples of business outcomes include things such as ranking in the top 3 in market share for a particular vertical, or expanding the footprint inside a customer segment by some number of new design wins.
However, even if we do our very best, we cannot always control outcomes. Customers may not have a budget, or they may go through an organizational change that affects buying decisions. And, of course, we cannot control competitors and what they may do in the market.
Good market research, solid competitive intelligence, and excellent customer relationships can all help ensure that we are setting realistic and achievable targets based on what we know about the situation and our capabilities.
2. Performance metrics are what we will do
Performance metrics are always action-oriented. Marketing performance metric examples might include rollout of a new product by a specific date to support entry into a new market, or securing a meeting with at least one key decision maker in the top 10 customers in each vertical before the end of the quarter.
Although achieving an outcome is not directly within our control, achieving a performance metric is. It may take tremendous work, but hitting performance KPIs is based on our own ability. Performance metrics are extremely important. They dramatically affect the attainment of the outcome.
3. Process metrics are what we need to do in order to realize the performance metrics
As an illustration of the idea of process metrics, consider the training world, where a process metric might be a certain cycling cadence rate that you attempt to maintain. Translated to the world of marketing, a process metric might be the development and implementation of a special offer that results in a specific response rate.
Formulating Performance Statements
Besides helping us reach a desired outcome, performance and process metrics help us develop, focus, and set priorities. Whether we are just beginning a performance management journey or we are among the best-in-class, marketers who incorporate all three types of metrics achieve the greatest success because those three metrics work together: Process metrics help us achieve the performance targets; if those targets are set properly, their attainment should enable us to reach our outcome targets.
Regardless of the category, George Doran's SMART approach ("There's a S.M.A.R.T. way to write management's goals and objectives," Management Review, November 1981) provides a well-used way to craft performance statements:
- Specific: Clarify what exactly is to be accomplished.
Example: We will acquire three new customers for the new product this year.
- Measurable: Objectively track your progress.
Example: We will generate twelve appointments with new customers to demo the new product by the end of the quarter.
Action-oriented: Establish the things that must be done, and by whom, to directly affect the outcome.
Example: We will execute a three-pronged outreach program to 75 new customers within 1 week of demo release.
- Realistic: Know what you can handle and develop steps along the way to help you get there.
- Time-related: Specify dates for when the results can be achieved.
Example: We will contribute 25% of the opportunities to the pipeline quarterly.
For some of us, all this seems intuitive and obvious. Yet, when we ask marketers about their metrics, how they set them, how the performance targets work together, and what their plan of action is, only a few marketers are prepared to answer.
To be successful, you must create and document a plan. Use the planning period to assess all of the areas that need improvement if you are to put yourself in a position for success, what you will do to address those—and when.
You should also plan for potential setbacks: Performance targets can be affected by any number of external forces, so try to anticipate what might happen and plan your response in advance. Doing so will help ensure calmer course adjustments if they are needed.
For example, to learn how to tactically swim in open water, I will need to sign up for a clinic four weeks before my first open-water race. Even all of the best athletes also rely on coaches. Marketers who want to excel should do the same. The performance management journey can be difficult, and if you need help you shouldn't hesitate to use the knowledge of a specialist to help prepare both you and your organization.