I’ve noticed some patterns in business owner decision-making behaviors over the years. Most of us tend to fall into more than one group. Among other things, we’re number crunchers, marketers, procrastinators, and magicians. Develop some self-awareness about which one of these groups you belong to. The more we know about ourselves, the better.
These folks track and (often) know every metric about their business. Sometimes that’s good. Sometimes, it isn’t. Don’t focus on metrics to the exclusion of other important work. It’s important to know your metrics, but having too many can fog your vision. There’s lead cost, lifetime customer value, ARR, MRR, conversion rate, traffic, net promoter score, and so on
Which do you focus on? If your company is large enough to have departments, each likely has a “most important metric”. How many are there?
While I’m a number cruncher (among other things), metrics aren’t everything. They’re a tool whose importance gains clarity when I travel.
The road strips away “metrics FOMO” because you can only handle so much while traveling. While I can have everything when I’m at my desk, I don’t NEED (or use) everything. On the road, I seldom need much more than “OK” vs “Not OK”.
Can you boil down your most important 37 metrics to “OK” vs “Not OK”?
Yes, “most important 37 metrics” was sarcasm, but you may have that many. You can’t focus on the most important work of the day AND keep your finger on the 37 heartbeats. There’s a time and a place for each metric, but it isn’t every day.
As my friend Tim Francis says, “You need only enough precision to make the right decision.”
Marketers tend to be number crunchers. We use LTV, CAC, and other metrics to make decisions & determine how we’re doing. We sometimes focus so hard on marketing that we forget everything else. Marketing metrics often drive mindset, even when there’s little profit. More than once, I’ve heard, “There’s so much gross, there has to be some net somewhere.” Pro tip: Know where the net is.
Jim Collins talks about making a decision as early as possible when known risks are stable. When the risk changes in severity or nature, review your decision.
Procrastinators view risks from a different angle. Making a decision as late as possible is one way to manage risk. It also increases cognitive load much longer than necessary. For decisions with little risk or little change in risk, procrastination has a cost. Sometimes the cost is that you aren’t ready for rapid change.
Some make decisions so fast that it appears they didn’t care. What you don’t often see is information gathering / review over time. One remaining piece of information may trigger their decision – it’s the final piece of the puzzle.
Almost everything magicians touch seems to turn to gold, even if it takes years. Many don’t appear to be working at all – often because they enjoy their work and the people involved. They’re often skilled decision makers.
The best decision makers have a process & guidelines. Ask and dig in – that’s where the gold lies. They often have a refined process for decision making, but refined doesn’t mean slow. Make decisions as soon as possible, but not “too soon”, and don’t look back. Focus on making your decision pay off unless changing conditions force a review.
The last word
After 14 years, this is my last column for the Beacon. I hope at least one of these 728 columns has helped you, your business, your team, and your customers.
Three things drove what I wrote about each week:
1) Whatever pushed my buttons,
2) A lesson (re)learned by me or someone I know,
3) Something reminded me that we all need occasional reminders.
If you’re an employer, remember that your most important people are your employees. They’re the ones who take care of your other most important people – your customers.
If you’re an employee, consider a side hustle. It might grow well beyond that. It might become your new role at your current employer. Almost everyone starts small. You have to believe, even when no one else does.
Thank you Liz Marchi and Kellyn Brown. It’s been a fun ride.
PS: Skinner, you win.Mark Riffey is an investor and advisor to small business owners. Want to learn more about Mark or ask him about a strategic, operations, or marketing problem? See Mark’s site, contact him on LinkedIn or Twitter, or email him at email@example.com.
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